Oklahoma City, State Lead The Country In Foreclosure Growth
New data from the online firm RealtyTrac indicates long-term problems in the energy industry are hurting home owners.
Oklahoma led the nation in the increase in foreclosure activity from January 2014 to January 2015.
The statewide rate increase 74 percent; the next-highest states were in the 40 percent range. In Oklahoma City, the annual change was 143 percent. RealtyTrac Vice President Daren Blomquist told The Journal Record’s Brian Brus that rate will likely continue to rise, because foreclosure starts are still up for January:
Blomquist said the data alone does not reveal the cause of the rising foreclosures rates, although the pattern seems to mirror activity in other states that rely heavily on mining and drilling. Anecdotal feedback from the industry suggests declines in oil and gas are probably playing a part, he said. Foreclosure attorneys in Oklahoma felt more certain of the connection. It’s no coincidence that Devon Energy had to lay off 1,000 of its workers this month, following similar downsizing at other energy companies.
Observers said the problem is not just that people in the energy industry lose jobs or leave certain towns when work disappears, but that those changes also affect small businesses such as restaurants and beauty shops, along with rental home operators.
“The problem is the same that Oklahoma continues to have overall,” said Jeff Tate with the Christensen Law Group in Oklahoma City. “It’s the oil and gas economy. The drop has been farther and sustained longer than a lot of people anticipated.” Tate said most mortgages foreclosures aren’t as simple as an oil-field worker losing his job and then losing his house. One client, for example, couldn’t find renters for his residential properties. Bret Davis at Lamun Mock Cunnyngham & Davis said he was shocked at numbers for Oklahoma City. He said most of the impact he’s noticed has been in rural towns, particularly in northwest Oklahoma, which have been suffering since last summer as shrinking drilling crews took revenue away from small business operators. Those restaurateurs and grocers and beauty shop owners have mortgage responsibilities of their own, he said. “If you look more closely, you’re going to see those numbers tied to the oil and gas business, although it’s going to be a trickle-down effect in the broader economy. You’re seeing what happens with state budget shortfalls,” he said.
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