DESPITE SLUMP, NO FIRE SALES YET IN VALLEY.

Byline: GREGORY J. WILCOX

Foreclosure, and terms related to the process, are fast becoming a part of conversations related to this real estate market slump.

Foreclosure activity is picking up.

For example, in last year's fourth quarter, the number of mortgage default notices filed against California homeowners soared to the highest level in more than eight years, according to market tracker DataQuick Information Systems.

Lenders sent 37,273 homeowners default notices during the October-to-December period, up 145.3 percent from 15,196, the prior year's fourth quarter.

It's troubling, but not necessarily disastrous.

The California Association of Mortgage Brokers notes that about 80 percent of these situations can be reversed.

Lenders don't like foreclosures any more than homeowners do.

"If consumers are getting behind in their mortgage payments and facing financial difficulty, they need to call their lender right away. The lender will work with the consumer in creating a program to bring their mortgage current and avoid the dangers of foreclosure," said Jack Williams, the association's president.

The association recommends that homeowners stay on top of their finances and be aware of signs of trouble like:

Making late mortgage payments or paying below the minimum payment on credit cards.

Mortgage payments getting progressively later each month.

Skipping one or more mortgage payments.

A change in your financial situation such as a lost job or unexpected high medical bills.

The current mortgage payment has adjusted to more than you can afford.

But there is a a sharp difference between perception and reality this time on the down side of a market.

Bargain hunters are going to be disappointed.

There's no fire sale, at least not in the San Fernando Valley. Yet.

Consider this. In the the prior big market turn, sales moved down between 1988 and 1989. Prices followed suit in 1990, with the median slipping 2.1 percent from the prior year.

Sales began falling in this cycle in 2004 and made a really big move, a 24.7 percent decline, last year.

But in 2004, the median price soared an annual 26.4 percent. Increases of 20.1 percent and 6.4 percent followed.

Now the annual increases are much narrower.

Activity is probably going to spike in this quarter, too.

DataQuick analyst John Karevoll said that this will likely give rise to a new marketing tool, pitching a property as being a "short sale."

That's when a lender agrees to accept a selling price that's less that is what is owed on the houses.

He's already gotten calls from some reporters in San Diego who had been told that this was becoming a trend.

He checked the numbers and couldn't find anything.

"People in sales like to pound the drum. They like to use anything they can to get people's attention," he said.

So far that is not happening here, said Jim Link, executive vice president of the Van Nuys-based Southland Regional Association of Realtors.

"We've had very few reports of short sales," he said.

greg.wilcox(at)dailynews.com

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