Wichita Home foreclosures in this aircraft manufacturing-dependent city appear to have slowed amid government and industry efforts to cut mortgage payments, but some experts anticipate many loans will ultimately end in foreclosure next year anyway.
Although the number of Wichita homes going into foreclosure in November remained below the summer peak, overall numbers continue to rise, according to the tracking firm First American CoreLogic.
As of October, 4.01 percent of Wichita mortgages were delinquent and 1.3 percent were in foreclosure, both setting new highs.
The slowdown in foreclosures reflects government and industry efforts to cut mortgage payments.
It also means the housing crisis has changed from one driven by bad subprime loans to one caused by job losses, said Stan Longhofer, director of the Center for Real Estate at Wichita State University.
“I would not have expected them to decline, yet,” he said. “I would expect them to level off. So, that is good news when you see that.”
The real estate tracking firm RealtyTrac shows 235 homes entering into foreclosure in November, considerably more than the 100 entering foreclosure in October. But the number was below those from six months earlier.
“On the face of it, that would be good news,” said Daren Blomquist, marketing communications manager for RealtyTrac. “We’ve never seen that in our report since we started in 2005.”
But he said the company was skeptical because the government and banks have interfered in the normal foreclosure process to renegotiate mortgage terms.
Some 2,181 homes in Kansas have been enrolled in the Making Home Affordable program, the federal government’s main effort to stem the foreclosure crisis.
But Blomquist said his company expects many of those mortgage-holders to default anyway, sometime next year, because loan modification typically just reduces interest rates or stretches out payments rather than shrinking the principle owed.
“It appears to be more of a Band-Aid than a cure,” he said.