On Thursday, January 25th the Denver Metro Task Force on Foreclosures met.  This was the first of 6 planned meetings to discuss potential remedies and to see what role cities could play in helping stop and reverse a foreclosure crisis that some neighborhoods are seeing.

According to Tom Clark, a vice president of Metro Denver Economic Development Corporation, lenders saw potential in Denver and other areas throughout the West with fast growth and rising housing prices.  With that came high risk loans to high risk buyers with housing prices seeing little to no rise.  These forces put Denver and Colorado into the number one spot of foreclosures.

How can Colorado move out of this status?  Job growth!  In 2006 all the jobs lost in 2002 and 2003 were finally replaced. 

For more information and the effects of foreclosures within neighborhoods and the schools visit the Denver Post online.

Colorado has the number one spot in 2006 for ..... foreclosures!  This is not the spot where Colorado wants to be.  But Colorado is not the only place that is seeing a high number of foreclosures.  California saw an increase in foreclosure notices of 145% in the fourth quarter of 2006 compared to the fourth quarter in 2005.

In Colorado, one in every 33 households had a filing of foreclosure during 2006.  Following Colorado is Georgia and Nevada with a filing for every 41 households.

Most loans are going into default within 1 to 2 years after the original loan was made with most banks beginning the foreclosure filing when the loan is about 5 months behind.  In Colorado, a higher percentage of properties go from the filing, through the "bank sale", and the transfer back to the bank - 45% compared to below 20% for the National Average.

Some reasons that foreclosures are at a higher rate - appraisers valuing homes higher than market, ability of more people being able to qualify for a home loan, interest only loans, ARMS, 100% financing with low home appreciation rates due to overbuilding, consumers with more debt than they can afford, and other inventive loan programs available.

Foreclosures have an effect on HOA's with dues receipts, housing prices, economy, and the well being of a community.

In Colorado, the legislature is looking for ways to protect consumers from loan and appraiser fraud.  In the long run, the question will be, "Does this help or hurt the consumer when the dream to own a home is just that a dream and can not be a reality?" 

For more information about Foreclosures in Colorado, visit the Denver Post online.