Stockton Makes the Top 10 Foreclosure List

The screws tighten:

Stockton landed on the top 10 list of the nation's cities with the highest foreclosure rates in the second quarter, according to a report released Wednesday. The Central Valley city was No. 8 on the list, with 1,228 homes in some stage of foreclosure. That's 1 of every 154 homes, or 2.3 times higher than the national average, according to RealtyTrac, an online marketplace for foreclosure properties.

Modesto's Roxanne Myers is caught in a refinancing dilemma, she said. She has an adjustable-rate mortgage that's about to go higher, so she wants to refinance. However, she also can't afford the monthly payment on a fixed-rate mortgage, she said. "It's scary," Myers said. "I'll probably get another ARM that's fixed for five years. "I don't want to sell, but that may become a reality."

Many borrowers who run into trouble have relatively low incomes or scuffed credit records. But housing counselors say they are also hearing from a growing number of middle- and upper-middle-income borrowers who borrowed heavily to finance spending or buy a house they could barely afford. NeighborWorks Homeownership Center in Sacramento, Calif., says that 38 percent of the borrowers it's seen this year have "moderate or above-moderate" incomes, up from 24 percent last year.