The good news for people in California is that the number of foreclosure cases that were filed against struggling homeowners has fallen since 2012 for all but a few states. In fact, only one percent of the homes across the nation had a foreclosure action filed against them last year. This is a significant drop from the number of 2.2 percent that existed in 2010. This may be in part because many people have found ways to deal with their unmanageable debt.
According to a recent report, the total number of homes across the country that were subject to the foreclosure process last year was 1.4 million. This may have been in part due to the consumer protection laws that were created during the real estate crisis that protected many homeowners during a foreclosure. The peak number of foreclosure cases occurred in 2010.
Interestingly, as many as six million homes have been repossessed by lenders in California and across the nation since 2006. Many of those who faced this situation also found that they had other unmanageable debt in the form of unsecured loans like credit cards. Those individuals may have discovered that they were able to slow the foreclosure process from its national average length of 564 days.
Unmanageable debt can be restructured in some cases through the personal bankruptcy process. One of the many benefits of a bankruptcy is an extension of time to a struggling homeowner to take action such as renegotiating loans, finding new housing and reorganization of debts. This fact makes it likely that people will be better able to recover after a financial crisis. This is good news for all involved and can mean a fresh financial start for those who faced difficulty during the recession and those who face it now.
Source: USA Today, Foreclosure activity drops to 6-year low, Julie Schmitt, Jan. 16, 2014