August Defaults and Foreclosures

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The pace at which San Diego homeowners enter the foreclosure process continues to shatter prior records.

In August, 2,350 San Diegans received notices of defaults (NODs), those nastygrams that officially let delinquent borrowers know that foreclosure proceedings have begun. 902 local homeowners received trustee sale notices (NOTs), nastier-grams that inform borrowers that they are just a few weeks from losing their homes.

Adjusting for San Diego's ongoing growth, last month's NOD filing rate was over 40 percent higher than the very worst month of the early 1990s housing bust, a spike upward in March 1993. NOT filings were 25 percent higher than their corresponding high point in July 1996.

The difference between today and the 1990s is that San Diego has not experienced any overall job loss this time around. The skyrocketing rate of defaults and foreclosures has a lot less to do with unemployment than with the unprecedented amount of speculative risk-taking that took place during San Diego's vast housing bubble.

-- RICH TOSCANO