Calif. Foreclosures Set Record

Reflecting the increasingly gloomy picture across the country, residential foreclosures in California were up 799% in the second quarter compared to the same time last year, the LA Times reports. Stricter lending practices and the reeling housing market contributed to the record high 17,408 foreclosures in the three-month period, dwarfing the state's last foreclosure spike, in 1996.

Default notices, often a harbinger of foreclosures, were also up 158%. Allowing for greater housing stock, the foreclosures are roughly equal with the 1996 figures; in contrast to that slide, this time experts point to resetting loan rates, which disproportionately effect first-time homeowners. One real estate agent speculates that the lax credit market has imbued homeowners with an easy-come-easy-go attitude. (More housing market stories.)