Monday, October 15, 2012
Unexpected Consequences Revealed
EUGENE, OR – Last month’s foreclosure sneaker wave dragged hundreds of Oregon homeowners into judicial foreclosure, forcing them into saturated civil courtrooms, while less punitive non-judicial foreclosures continue to plummet.
“As predicted, the damage from judicial foreclosures continue to painfully mount for banks and homeowners,” said John Helmick, CEO of Gorilla Capital. “Because of Oregon SB-1552, homeowners and banks now go to court to settle foreclosure matters where unnecessary fees are paid and credit ratings are ruined, as opposed to the less costly and less severe non-judicial process where a portion of the swamped out loan is forgiven and credit ratings heal faster.”
In the 20 Oregon counties served by Gorilla Capital, judicial foreclosures climbed to 561 in September as compared to 538 in August, and compared to less than 90 a month for the first 3 months of 2012 (which was prior to the passage of SB-1552). Notice of Defaults for non-judicial foreclosures in September were 75, compared to 122 in the previous month, and compared to over 1,200 per month for the first three months of 2012.
By comparison to the first three months of 2012, judicial foreclosures are up over 600%, while non-judicial foreclosures are down 95%.
Oregon Public Broadcasting reported on Oct. 9, that the effects of Oregon SB-1522 are being felt far beyond the real estate market. OPB reported that due to the increase of judicial foreclosures, banks are not paying to advertise Notice of Defaults in newspapers, as previously required. The parent company of Bend’s The Bulletin told OPB that as a result of the loss in revenue, it will lay off several employees and not fill some open positions.
“The ripple effect of the judicial foreclosure sneaker wave will not be fully felt until these former homeowners try to build back their financial lives only to find that their credit rating cannot be repaired in any sort of a timely manner,” Helmick said. “The key benefits of a non-judicial foreclosure is that the bank pays fewer fees and, if the house sells for less than the loan amount owed, homeowners can more quickly repair their credit rating.”
Helmick forecasts the number of judicial foreclosures to climb, while non-judicial foreclosures will continue to decline over the next several months.
About Gorilla Capital
Gorilla Capital is one of the nation’s leading purchasers of distressed real estate. Gorilla Capital has been ranked by Inc. Magazine as one of the 1,000 fastest growing companies in America, each of the last 3 years, and was recently ranked as the 20th fastest growing real estate company in America. Oregon Business magazine ranked the company on the Private 150 list of the largest privately held companies in Oregon. Operating in multiple states, Gorilla Capital is based in Eugene, Ore.
The company prides itself on being methodical, efficient and tireless in its pursuit of properties that will appeal to the value-conscious homebuyer. After research, inspection, assessment and purchase of the distressed real estate, Gorilla renovates the house and then offers the fully remodeled home to the public at exceptional value. All of Gorilla’s homes are backed by a third party, one-year home warranty.
For more information, visit www.GorillaCapital.com, or call (541) 344-7867.