- Associated Press - Sunday, November 23, 2014

PORTSMOUTH, Va. (AP) - A Portsmouth official is troubled by the city’s high foreclosure rate and fears it could worsen if it is not addressed.

Portsmouth had the highest foreclosure rate in Virginia in October at 1 in every 584 homes, more than double the statewide average of 1 in every 2,078. Danville had the lowest rate, at 1 in 30,231, according to foreclosure-tracking firm RealtyTrac.

Portsmouth’s rate in September was 1 in every 730 homes. The city has recorded similar rates throughout the year, The Virginian-Pilot (https://bit.ly/1HCFlHZ) reported.

“It’s disturbing to hear that information,” Franklin Edmondson, Portsmouth’s commissioner of the revenue, told the newspaper.

“If we don’t take corrective action from a strategic standpoint, then it will lead to further demise,” he said.

Edmonson said his office has noticed several possible reasons for the city’s foreclosure rate, including a decline in residents’ sustainable income, corporate cutbacks and higher homeowner costs.

“When you have several things happening at one time, it’s almost like a perfect storm,” he said.

“We should start preparing for the worst,” he said, “but hoping for the best.”

Portsmouth Assessor Janey Culpepr said she does not know why the foreclosure rate is high. But she told the newspaper that she does not “put a tremendous amount of stock” in such surveys.

“They don’t really understand the secondary market,” she said.

In raw numbers, foreclosures in Portsmouth declined from 564 in 2012 to 508 in 2013, which follows downward trends nationally, she said.

“We have some areas that are improving tremendously,” she said.

Banks could be returning to a more normal foreclosure process after foreclosing hard on higher-income areas, said Daren Blomquist, a RealtyTrac vice president.

“During the worst of the foreclosure crisis, back in ‘09 and ‘10, we were seeing a lot of the middle-class and higher-end areas hit very hard because of folks getting in above their heads,” he told the newspaper.

Within Portsmouth, the poorest zip code had the highest foreclosure rate in the city, RealtyTrac statistics show.

Norfolk bankruptcy lawyer John McIntyre said the problem in lower-income areas could be due to residents being unable to pay the bankruptcy fee to try to save their homes.

“They just walk away,” McIntyre told the newspaper. “They give up.”

He also said some lenders have a reputation of preying on lower-income homeowners.


Information from: The Virginian-Pilot, https://pilotonline.com

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