Expert: Numbers consistent with national trend
By Sean Ruppert, Staff Writer
Reflecting a national trend, foreclosure rates have been rising significantly in East Windsor and Hightstown.
Thus far this year there are eight homes that have been issued a writ of execution of foreclosure a court order to foreclose on a property in East Windsor and three in Hightstown, according to information provided by the Mercer County sheriff’s office.
In 2008, there were 23 homes in East Windsor foreclosed upon; up from 14 in 2007. In Hightstown, there were 12 foreclosures in 2008; up from just one in 2007.
Many of the properties were reclaimed by banks, while others were settled through bankruptcy proceedings or paid off by the owner before they went to auction. Others were sold in a “short sale,” where the bank allows borrowers to sell the property and settle the debt for less than what they owe. Short sales can occur before or after a writ of execution of foreclosure is issued.
Nationally, between the second quarter of 2007 and the same quarter in 2008 the latest dates for which data was available from the New Jersey Association of Realtors the foreclosure rate rose from 1.2 percent to 2.7 percent in the state, and from 1.4 percent to 2.8 percent nationally.
Kathe Newman, an assistant professor of Urban Planning and Policy Development at Rutgers University, said the rise in East Windsor and Hightstown is consistent with other places.
Dr. Newman said the issuance of a writ of execution of foreclosure occurs toward the end of the foreclosure process, which she said often takes about 18 months. So it is likely that the foreclosure process began in the previous year for many of the properties that were foreclosed on in East Windsor and Hightstown. Any foreclosure proceedings beginning now would likely not be foreclosed on for sometime.
”Foreclosure is a process in New Jersey,” Dr. Newman said. “When a borrower is 90 days or more delinquent, the lender can file a complaint with the county which goes through judicial procedures. The writ of foreclosure is sort of towards the very end.”
She added that some properties on which the lender files a notice “lis pendens” the start of foreclosure proceedings don’t ultimately wind up in foreclosure. So it’s likely that there were more properties in which foreclosure proceedings began but were not completed.
David Lyttle, the manager of Weichert Realtors in East Windsor, said that while he has seen an increase in foreclosures, the housing situation in the area is not dire.
”Foreclosures are happening here, but they are not endemic in the area,” he said. “I think one of the misnomers is that people think there are a lot more than there really are. There is a distinct difference between a foreclosure and a short sale. We are seeing a lot more short sales than we are seeing foreclosures.”
Mr. Lyttle also said the problems with foreclosures have been a little overblown to the public.
”We are still talking about a very low percentage of the housing supply,” Mr. Lyttle said. “You hear, ‘foreclosures are up 50 percent,’ and it sounds very bad. But if it is going up from 1 percent to 2 percent, then we are still talking about a relatively low number.”