Article Courtesy of The Orlando Sentinel
By Mary Shanklin
Published October 12, 2012
For the first time since
During the past year,
foreclosures dropped 13 percent nationally but increased by more than that
closely reflected the rest of the state: Foreclosure actions increased 14
percent during the third quarter from a year earlier. RealtyTrac analysts
think growing pools of foreclosures typically place downward price
pressure on overall housing in an area.
A combination of factors,
including homeowner associations foreclosing on homes and hedge funds
snapping up properties, appear to be contributing to the run-up in
"When people let their
homeowner-associations fees become delinquent, that's what's causing
foreclosure rates to go up because the associations get tired, and they
foreclose on these people," said Scott, an agent with Keller Williams
Classic Realty. "But it's still a can of worms."
When homeowner associations
take ownership of a home, they typically try to fix up the property and
find a tenant. However, they often only have the properties briefly before
the banks take them back.
Some real-estate experts
have noted that
Another factor that appears
to be driving up foreclosures during the past year is that hedge funds
have increasingly started buying up the properties at auction, giving
banks more incentive to push the properties through the legal system
rather than trying to market them as short sales.
American Homes 4 Rent is an
example of a fund that has purchased hundreds of foreclosures in
"It's no secret the
court systems are overburdened with cases, and they're cutting back left
and right on the remaining staff," he said.
And finally, Borack added,
homeowners have tired of trying to get banks to modify their mortgages.
More owners are deciding to stop paying for a house worth half what it was
when they bought it near the peak of the market in 2007, he said.
me it's very simple," he said. "People are realizing there are
other alternatives. And they say: 'What are the banks going to do to me
— kick me out of my house?' "