TELLURIDE – The economy may be rumored to be in recovery, but you wouldn’t know it by looking at San Miguel County’s foreclosure filing list.
“We got slammed with foreclosures this week,” said San Miguel County Treasurer and Public Trustee Jan Stout during an interview last week.
“We received six since Monday.”
Indeed, a list that topped out at 97 open files by the end of 2009 shows no apparent signs of slowing. Stout’s office has opened 11 new foreclosure files since the first of the year, according to the county website
“We’re going to see increased numbers over 2009,” she predicted. “My best guess is that we might see 150 this year.”
But despite the large number of open files – which run the gamut from fractional ownerships to mansions and vacant lots owned by locals, second homeowners and investors alike – the ultimate loss of property isn’t a foregone conclusion.
“The majority of the files don’t actually go to the courthouse steps,” said real estate analyst Judi Kiernan of Telluride Consulting, describing the final stage of an involved negotiation process in which a property is finally sold because its owner has been unable to keep up with payments for it over an extended period of time.
“So those numbers are really alarmist,” she continued, noting that 37 properties were sold by county by the end of 2009, for which deeds on 26 had been issued. (In 2008 deeds were issued on just three properties).
In the meantime, however, the county has issued deeds on six more of the 2009 sales and the rest are awaiting deed, Stout said.
A lot can happen between a file being opened on a property and its eventual sale, though, as evidenced by the withdrawal of one file opened earlier this month from the foreclosure list.
“People are still trying to work with mortgage companies for a workout even after foreclosure is filed,” said Stout.
A less widely recognized threat from the foreclosure crisis hits homeowners associations, according to Telluride attorney Diane Wolfson.
“There’s no question that there’s more people who are delinquent in their dues,” she said, explaining that if one owner in an HOA is foreclosed upon, “everybody else holds the bag” for their dues.
“HOA’s really need to start looking at how to protect themselves,” Wolfson said.
But increased movement in the real estate sales market gives Stout hope that some distressed homeowners might be able to sell before they get to the point of foreclosure.
“I’m hearing from a few realtors that they’re thinking things are going to get better,” she said. “That gives me a little bit of hope for later on in 2010.”
And hope could come in handy for Stout who, when it comes to foreclosure sales, has an unenviable job.
“What gets me the most is when I know a local is trying to work something out and I have to sell,” she said.
“I try to leave it between here and Norwood,” where she lives.
But the toll hasn’t been so high that Stout is ready to give up, she said, confirming to The Watch that she plans to seek re-election this fall.
“There are too many things I haven’t accomplished,” she said. “I have plans for things in the office past my current term.”
Kiernan, who has made a career tracking the ins and outs of the local real estate market, took a pragmatic look at the foreclosure statistics, pointing out that many are investment properties, not primary residences.
She also noted that more than one owner on that list has multiple properties in San Miguel County in the foreclosure process.
“I think that people were overextended, “ she said. “They were seduced by the availability of financing and got overextended in the number of properties that they could handle.”
“This was not somebody’s home,” Kiernan continued. “These are the consequences of taking these kinds of risks, that’s kind of the nature of the game.”
“Had the timing been different, the outcome would have been different,” she said.