Which data source I can rely on foreclosure data ?

[Orhi Tahi]

Hi investors,

Which data source I can rely on foreclosure data ?

By city By state and By US is the data i am looking.

Thanks,

Orhi

[Ron S.]

Quote from @Chris Seveney:

@Orhi Tahi

Most homeowners have equity in their property

If your home is worth $400k and you owe $200k and have a 4% mortgage - your mortgage is cheaper than rent - so why would a borrower let a bank foreclose when they can just file bankruptcy, keep the house and restructure the debt

 With all due respect, you don't "just file bankruptcy, keep the house and restructure the debt", regardless of your equity. Maybe in a chapter 11 you can restructure but that's not for consumer debt. Consumer borrowers have the option of a 7 or 13, sometimes a 12 if they are fishermen or farmers but none of those allow for restructuring. Yes, a 13 will potentially allow for a cram down or lien strip but we aren't in that environment where liens can be stripped or shrunk due to value depreciation. 

So, to use your scenario if the home is worth $400M and they owe $200M and are in foreclosure, what happens? Well, in a 7, they have to qualify for the 7. There is a means test for income and equity. If they have no job, this is the route they will go and no, they won't be keeping the house if they can't bring it current (Although they can sell it). If they have a job and assuming they meet the income test, they will have their unsecured debt wiped out and they will have all personal liability for their secured debt stripped. They will state their plan for the secured debt which for the most part will be one of three options, 1) Reaffirm (rare) or, 2) surrender (Common for cars, not common for homes unless there is no equity) or, 3) "Pay and retain pursuant to contract (Which means i want it but i'm not reaffirming it).  Approximately 120 days after they file, their BK is done and all their unsecured debt is wiped out. The foreclosure continues or restarts from that point on unless they brought it current completely.

In a chapter 13, they file a plan and must have income to do so. Their plan is filed with the court and the court and the creditors object or agree to that plan. The court would object if it is not adequately funded or could object of a creditor is unfairly treated over other creditors or for a multitude of other reasons. The creditor could object if they are not taken care of in the plan according to their filed proof of claim (They filed an accounting with the court stating what is owed). The plan includes how they will pay for arrearages and typically, the arrearages will be paid for over 3 or 5 years (36 or 60 payments). If the plan does not bring the loan current, it won't be approved and the bk will be dismissed or the borrower will have to file an amended plan. If they do have a valid plan, its confirmed and they pay the current payment plus 1/60th (or 1/36th) of the arrears until the BK plan is completed. If they fail to pay, their BK gets dismissed and the foreclosure continues.

Yes, i'm going 20,000 feet in my scenario and tons of things can happen but for the most part that's how a BK works. My point is, its not a "File BK, keep the house, and restructure the debt" scenario typically.