OKLAHOMA CITY — Thousands of Oklahomans have joined the ever growing number of people nationwide who cannot meet their mortgage payments.

There were 5,806 Oklahoma foreclosure filings reported during the third quarter of the year – a 2 percent increase from the previous quarter and up 15 percent from the third quarter of 2009 – according to real estate data service RealtyTrac Inc.

Early on, Oklahoma avoided the fallout of the foreclosure crisis better than most of the country. The Sooner State ranked 31st in the nation last quarter for its foreclosure rate of one filing for every 282 housing units. Oklahoma's rate is about two times lower than the national average and dwarfs in comparison with some of the hardest hit states, such as Nevada or Florida.

Still, the hard fact is more Oklahomans are on pace to lose their homes in 2010 than in 2009.

“It is a larger problem than what most people are ready to admit,” said Jamie Reganall, a housing counselor with the Muskogee Housing Authority, who said she personally has worked with more than 200 homeowners this year who have gone through foreclosures. “The (economic) downturn trickled down to Oklahoma a little slower than most (places) so there wasn't a major crash and rebound like elsewhere. It's more of a steady pace.”

So what shielded Oklahoma from that major crash?

Doyle Province, president of the Oklahoma Mortgage Brokers Association, said the state's relatively low unemployment rate largely safeguarded the state from mass foreclosures. Oklahoma also saw less speculative property buying than most states and the low cost of living kept prices from fluctuating widely.

But, Province said, the housing market crash still is taking its toll on the state.  

Province said job losses remain the largest factor in the counties hardest hit with foreclosures. Tulsa and Wagoner counties – which both have unemployment rates far above the state average – saw the highest foreclosure rates in October.

The state's unemployment rate has yet to significantly drop since the jobless numbers began to climb at the end of 2008. With foreclosures usually lagging slightly behind job losses, further unemployment could worsen the situation.

“All in all, I think it is the jobs,” Province said. “Just about every one of our (foreclosures or mortgage modification requests) is about something job related, so if we had more problems with jobs, I think we would see more problems with foreclosures here.”



What's being done

Oklahoma Attorney General Drew Edmondson is searching for answers.

Edmondson joined the other 49 state attorneys general, as well as banking officials and mortgage regulators in requesting an investigation into robo-signing – the process in which foreclosure documents are signed without confirming their accuracy

On the national scene, the Mortgage Foreclosure Multistate Group is continuing its probe into whether some foreclosures were processed illegally. The investigation was launched last month when details emerged that a number of foreclosures  were filed with procedural defects. The Mortgage Foreclosure Multistate Group is studying if robo-signing could have created faulty foreclosure sales. A final report has not yet been delivered.

Oklahoma Mortgage Brokers Association's Province, said no evidence of wrongdoings has been found in Oklahoma. He said the investigation is unlikely to affect mortgage lending restrictions.



The effect on neighborhoods

Neighbors of homeowners going through a foreclosure also often feel the collateral damage.

Province said foreclosures can bring down housing prices for surrounding houses and hurt a community's reputation.

“You can have a really nice neighborhood and you have a foreclosure go on there, and then you have a situation where someone stops making payments on a house and stops taking care of it,” he said. “So your neighborhood looks nice and then you have one (house) that has grass all grown out and it is not being maintained.”

The Center for Responsible Lending estimates nationwide foreclosures in 2009 caused 69.5 million nearby homes to suffer an average of $7,200 loss per home. People who buy foreclosures and quickly flip the properties for a small profit can also pull down prices, officials said.

Here in Oklahoma, George E. Stanphill, a retired World War II veteran, said he is concerned that foreclosures could hurt the central Chickasha neighborhood where he grew up and now lives.

“There are a lot more vacant house than ever before, and there are a few down there,” he said, pointing down his street where there are several houses waiting to be sold after being foreclosed. “I suppose I never really worry about it, when it doesn’t affect me. But it's not good for anyone when they let the property go (in foreclosure) and all that.”



The impact on families

Gloria Chipman will lose her house Dec. 2.

An Oklahoma County Sheriff's Foreclosure sale will decide the next owner of Chipman's home.  

While individual financial struggles are unique, there are similar threads through each story.

Chipman, an Edmond resident, said the loss of her home comes in the wake of Murrah Building bombing and a series of bad advice and poor choices.

She said she began to fall behind on her mortgage payments after her husband, Robert, was killed during the Oklahoma City Bombing. It became clear she wouldn't be able to avoid defaulting on her mortgage when last year's stock market crash wiped out much of her savings.

Chipman said the loss of income her husband would have generated was a factor in her foreclosure. But she said the economic downturn and her acting on bad investment advice contributed as well.

“It was not something I wanted to do, and the home should've been paid off,” Chipman said. “It's embarrassing and heartbreaking, but I needed to move out.”

Reganall, the Muskogee Housing Authority counselor, said many former homeowners are forced to move in with their extended family, apply for low-income housing or find open rentals, which often is limited in rural areas. Foreclosures particularly hit large families the hardest, she said.

“For many the housing situation is very limited,” she said. “A lot have to take their children out of school, they move out of town or families will even split up because one (of the parents) will have to move away for a job.”

Chipman said for her, moving meant leaving her home of the past 22 years and finding a rental at a more affordable price.

“Where I am living now is not even big enough to have family over,” she said. “I don't know what else to do but take it one day at a time.”



Trevor Brown covers the Oklahoma statehouse for CNHI. He can be reached at tbrown@cnhi.com.





-----breakouts----

Foreclosures data

United States

• Total during third quarter of 2010: 930,437

• Foreclosure rate: 1 filing for every 139 housing units

• Percent change since second quarter 2010: 3.9

• Percent change since third quarter 2009: -.79



Oklahoma

• Total during third quarter of 2010: 5,806

• Foreclosure rate: 1 filing for every 282 housing units

• Percent change since second quarter 2010: 2.27

• Percent change since third quarter 2009: 15.38

Source: RealtyTrac

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Foreclosure rate (Percent of total housing units with a foreclosure filing )

State             2007     2008     2009

Oklahoma     0.52      0.78       0.8

Texas            0.94      1.04       1.1

Kansas          0.2        0.51      0.74

Arkansas       0.51      1.12       1.3

Missouri         0.9       1.19       1.08

U.S.               1.03       1.84      2.21

Source: RealtyTrac

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New October foreclosures in Oklahoma by county:

Total: 1,718

Tulsa: 634

Oklahoma: 327

Cleveland: 203

Rogers: 91

Canadian: 54

Creek: 44

Comanche: 38

Muskogee: 36

Pottawatomie: 33

Grady: 32

Wagoner: 31

Logan: 22

Kay: 22

Delaware: 19

Carter: 19

Mayes: 16

McClain: 16

Le Flore: 14

Payne: 11

Garvin: 8

Washington: 4

Sequoyah: 4

Pawnee: 4

Pontotoc: 4

Beckham: 4

Custer: 3

Ottawa: 3

Cherokee: 3

Kingfisher: 2

Blaine: 2

Mcintosh: 1

Byran: 1

Love: 1

Hughes: 1

Lincoln: 1

Pittsburg: 1

Osage: 1

Dewey: 1

Adair: 1

Cotton: 1

McCurtain: 1

Caddo: 1

Stephens: 1

Woodward: 1

Washita: 1

Source: RealtyTrac