Home loan defaults on rise
GLENWOOD SPRINGS- The number of home foreclosures in Garfield County is already higher this year than in all of 2002. According to a report prepared by deputy public trustee Bob Slade of the Garfield County Treasurer’s Office, banks have reported 71 foreclosures to date this year in Garfield County, compared to 69 in all of 2002.Slade is projecting 111 foreclosures by the end of the year, which would be the most in Garfield County since 1987.The high number could be the result of a weak national economy, said Slade.”I think Garfield County lags behind the national economy,” said Slade. The county would just now be experiencing the effects of a larger national downturn in the economy that started in 2001, he said. The foreclosures are “probably just due to the economy and people losing their jobs,” said Denise Lange, owner of Divide Mortgage Services in Rifle. Eric Poulson of Wallick & Volk Mortgage Bankers said many people live month-to-month.”American consumers just get so tapped out on their monthly spending,” he said. Then when people lose their jobs, they don’t have the money to make payments on their homes. Lange also said many people refinanced their homes when mortgage rates were low, and may have gotten over-extended.Linda McKinley of Premier Mortgage Group agreed that homeowners may have stretched their finances too thin through refinancing.”It’s been very easy to take care of that consumer debt through the refinance process,” she said.Refinancing allows consumers to get rid of credit card debt, which typically carries interest rates of 14 to 21 percent, by applying it to their mortgage, where interest rates were as low as 4.75 percent recently, said McKinley. “It was great, because it helped them spread their debt out over a 30-year loan,” she said. The trouble started for many consumers when they failed to stop spending after refinancing, and went further into debt, said McKinley. “You can’t spend, spend, spend, without a plan to get out of debt,” she said.Eventually those who refinanced but failed to control spending may have gotten in over their heads, she said, which could have contributed to the high number of foreclosures this year.In recent years the number of foreclosures has climbed steadily. In the past 23 years Garfield County had the fewest foreclosures from 1993 to 1997, with fewer than 20 a year. In 1996, there were just 14. In the late ’90s and early this decade, the number of foreclosures began to rise. Between 1999 and 2002 there was an average of 51 foreclosures each year. The number of foreclosures spiked in the mid 1980s due to the oil shale bust. From 1983 to 1987 the average number of foreclosures was 194 a year, with the peak in 1985 at 244. Contact Ryan Graff: 945-8515, ext. firstname.lastname@example.org
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