The Arizona real estate market has seen a rise in foreclosure rates after a recent lull. The increased numbers may result in more bank owned property purchases that could translate to good opportunities for homebuyers in the area but may be stressing more mortgagors than before.
RealtyTrac, a real estate data company reported a growth in foreclosure rates in Arizona to 26 percent higher than September numbers. Overall, the rates are still lower than they were a year ago, but October’s increase is the second month rates have gone up. RealtyTrac’s Vice President attributed the increase to a drop in all-cash purchasers that previously bought up properties as investments before the bank repossessed them.
While increased foreclosures may be positive news to homebuyers looking to buy at below market value, it also means some families have been displaced after being unable to meet their mortgage requirements. Before foreclosure becomes a necessity for a family, some alternatives to foreclosure exist that should be considered.
First, a lender may be able to arrange a special forbearance payment plan or provide a temporary reduction of payments. A recent income reduction or increase in living expenses may help a family qualify for such a forbearance. Second, a mortgage modification may offer the chance to refinance the debt or extend the mortgage loan term. Third, a partial claim may be allowed if a lender can help request a one-time payment from the FHA-Insurance fund to bring a mortgage current, so long as the mortgagor is able to begin making full payments once again afterwards.
Additionally, a pre-foreclosure sale may allow a family to sell the property for an amount less than that necessary to pay off the mortgage. Finally, a deed-in-lieu of foreclosure may give the mortgagor a chance to return the property to the lender while lessening the negative impact on the mortgagor’s credit.
Source: Arizona Public Media, “Foreclosure Rates in Arizona Up for Second Straight Month,” Zachary Ziegler, Nov. 13, 2014