L.A. defaults jump 38%

A total of 27,981 mortgages default notices were filed in Los Angeles County during the first quarter, according to Dataquick, up from 20,339 a year earlier. You might recall a short lull last fall after a state law took effect requiring lenders to try and keep troubled borrowers in their homes. But lenders appear to be playing catch-up. "The nastiest batch of California home loans appears to have been made in mid to late 2006 and the foreclosure process is working its way through those," said John Walsh, DataQuick president. From the press release:

Of the 3.7 million home loans made in 2004, less than 1 percent have since resulted in a lender filing a default notice. Of the 3.7 million loans originated in 2005, 4.9 percent have triggered a default notice so far. Of the 3 million in 2006, 8.5 percent have so far resulted in default. A particularly toxic period appears to have been August through November 2006 which had more than a 9 percent default rate. Of the 2.1 million loans made in 2007, it's 4.6 percent - a percentage that's likely to rise significantly during the rest of this year.

[CUT]

The lending institutions with the highest default rates for loans originated in August to November 2006 include ResMAE Mortgage (69.9 percent of loans resulting in a default notice), Master Financial (64.6 percent) and Ownit Mortgage Solutions (63.6 percent). Of the major lenders, IndyMac has a default rate on those loans of 18.9 percent, World Savings 8.0 percent, Countrywide 7.7 percent, Washington Mutual 6.3 percent and Wells Fargo 3.4 percent. Less than 1 percent of the home loans originated in late 2006 by Citibank and Bank of America have since gone into default.

NOTICES OF DEFAULT 2009Q1 (% change from 2008Q1)
Los Angeles 27,981 +37.6%
Orange 8,427 +19.0%
San Diego 10,111 +12.7%
Riverside 16,906 +12.5%
San Bernardino 13,276 +19.1%
Ventura 2,648 +21.7%
Imperial 885 +56.4%

Source: Dataquick