County foreclosure rates outpacing previous years

County has already started 31 this year, had 27 in all of 2007

Gunnison County has already started foreclosure proceedings on more properties this year than it did in all of 2007, when the foreclosure epidemic peaked on Colorado’s Front Range.

While many parts of the nation were feeling the full impact of mortgage defaults and areas on Colorado’s Front Range were seeing 2 percent and 3 percent of homes entering into foreclosure two years ago, there were a total of 27 foreclosures countywide.
The following year, in 2008, the number of foreclosures jumped threefold, to 81, or less than 1 percent of all county homes.
Already this year there have been 31 foreclosures started in the county.
According to county treasurer Melody Marks, most foreclosure statistics are given as starts, since the number of finalized foreclosures is hard to track.
Because it is hard to follow a home foreclosure to its completion, Marks says it is also very difficult to tell how many homes make it to sale. But of those houses that did make it to sale, a lower percentage sold than in the rest of the state.
Over the last two years, public trustees across Colorado reported that more than 50 percent of foreclosure filings turned into home sales, whether at auction or on the market. In Gunnison County, 7.5 percent of the foreclosed homes were sold in 2007 and around 30 percent were sold in 2008.
Most of the statewide data is swayed by foreclosure statistics on the Front Range, where foreclosure rates are the highest, particularly in Adams, Denver, Arapahoe and El Paso counties. Last year, one in 44 Adams County homeowners started foreclosure proceedings.
Colorado’s Western Slope showed foreclosure rates that were a fraction of those on the Front Range, with Gunnison County logging one foreclosure for every 245 homes.
The last period of unusually high foreclosure rates in the county was in the mid-1980s, when more than 100 foreclosures were started in three different years and peaked in 1987, when 137 foreclosures were initiated.
Marks says foreclosure rates in mountain counties often reflect foreclosures on second homes and time-shares. But so far she’s seen no pattern or epicenter for the foreclosure boom in Gunnison County.
“Foreclosures have been fairly evenly disbursed throughout the county, although we have noticed a trend this year of more foreclosures in Crested Butte. But it’s too early to say if it’s more than a temporary problem,” she says.
One reason Marks is anticipating more foreclosures in the coming year is because the adjustable rate mortgages that can raise the monthly payments of borrowers without warning will continue to adjust into 2009.
“Preliminary January [2009] numbers are showing a modest spike in foreclosure activity and it appears that the effects of the economic downturn have not yet appeared in the data as a generator of new foreclosure activity. When, or if, that will happen I don’t know and couldn’t predict,” says Marks.
People who have fallen behind on their mortgage payments could get some help from the federal Making Home Affordable plan that was signed into law by President Obama two weeks ago. That plan is intended help people refinance mortgages to get lower interest rates or modify their mortgages to have lower monthly payments.
In Colorado, more than 4,200 people have avoided foreclosure by calling a counselor at the Colorado Foreclosure Hotline at 1-877-601-HOPE, according to the state’s website.
Gunnison County is also offering counseling to help people avoid foreclosure through the Housing Authority, which can be reached at 641-7900.