San Diego Metro reports that another round of foreclosures is expected to hit the San Diego region. Real estate investment firm, Blue Sky Capital predicts that this wave will be even more substantial than the previous round of foreclosures in the county.
The company said it has been tracking area properties and found that mortgages secured with Option Arm and Alt-A funding are about to reset at much higher rates. That will mean larger mortgage payments for homeowners who can’t afford it, pushing many into foreclosure. “While these Option Arm and Alt-A loans exist throughout the county, areas like Carmel Valley are filled with them,” said Chris Williams, CEO. “During our tracking of distressed properties in the county we found many homes in areas like Carmel Valley were purchased with zero, or a small amount down, so there is very little equity in theses properties.” With more than 36 percent of all mortgages in San Diego underwater, or having negative equity, Blue Sky Capital said it expects things to get worse before they get better.
Via SD Metro