Foreclosures Decrease; Mortgage Woes Don't

10% Drop in Charles In Second Quarter

The number of foreclosures in Charles County dropped in the second quarter of the year, but residents still face significant mortgage troubles, according to a report issued this month by the Maryland Department of Housing and Community Development.

Foreclosures in Charles declined more than 10 percent between the first and second quarters of this year, mirroring a trend that experts attribute to a change in state law increasing the grace period before a foreclosure can take effect. Still, the number of foreclosures in Charles and across the state more than doubled since the end of the second quarter last year.

Charles recorded 4 percent of the state's overall foreclosures in the second quarter, despite having 2.5 percent of its population. And the county had three foreclosure "hot spots," all Zip codes in Waldorf, with large numbers of foreclosures per capita.

"There may have been a minute decrease in the number of people coming in, but I'm still swamped," said La-Ronda Johnson, senior housing counselor with the Southern Maryland Tri-County Community Action Committee, which provides services to people facing foreclosure. "You can't read this report and say, 'The problem is getting fixed.' "

Experts have offered several theories on why Charles has been hit particularly hard by the foreclosure crisis, but many say homeowners moving from Washington area communities and taking on larger mortgages for bigger homes is a key reason.

"Some people are trying to keep up with the Joneses, and they get into trouble," Johnson said.

Johnson estimated that three-fourths of her organization's clients are from Charles, with the remainder coming from Calvert and St. Mary's counties. Southern Maryland's three hot spots in Waldorf were in the Zip codes 20601, 20602 and 20603. Calvert has a smaller hot spot in Lusby, and St. Mary's has none. In the Zip code 20602, Charles's worst hot spot, one of every 77 homes has been foreclosed.

The Southern Maryland Tri-County Community Action Committee, the region's only non-governmental source of housing counseling, works with about 40 clients a week, Johnson said. The group currently employs two housing counselors and is hiring a third.

Prince George's County had 32 percent of all foreclosures in Maryland, according to the report, and Montgomery County and Baltimore also reported high rates. In St. Mary's and Calvert counties, foreclosure rates were roughly in line with the size of the populations, although both counties have seen rates jump significantly since a year ago.

Charles's high foreclosure rate has caused serious problems for county agencies trying to balance decreased property tax revenues with increased utility costs and the need to pay cost-of-living adjustments to employees.

The Charles Board of Commissioners and the school board battled openly over the county's education budget this year, with the commissioners saying they couldn't fund the kind of increases school officials were requesting. Board of Education members warned that being too fiscally conservative would damage the quality of the county's public education.

"Are you willing to see headlines saying there's a decline in test scores and teacher salaries and there are more portable classrooms, which we are already the king of?" school board member Pamela A. Pedersen (St. Charles) asked the commissioners in spring. "I hate to put it in those terms, but that's what we're looking at."

The commissioners ultimately decided to fund a 3.5 percent cost-of-living increase for school employees.