A trio of reports on the borrowers situation in California. "Orange County's foreclosures nearly doubled in June, rising to 65 property sales from 35 in May. Overall, foreclosure activity, including default warnings to delinquent homeowners, was up 60 percent last month, the report shows. The county had 639 new foreclosure filings last month, up from 399 in May."

"Riverside County had one new foreclosure filing for every 438 households, the area's highest ratio and the third-highest in California."

"About 3,350 homes in Riverside County, representing one in 175 of its households, were in foreclosure proceedings at some point in the second quarter, according to the firm. The U.S. Federal Reserve Bank has implemented 17 quarter-point raises in the so-called Federal Funds Rate since late 2004. The result has been that even initial payments on fixed-rate and adjustable-rate mortgages are considerably higher than they were a couple of years ago."

"'They haven't gotten 18 pay raises,' said Victoria Johnson, president of the North San Diego County chapter of the California Association of Mortgage Brokers."

"The increase in foreclosures was just as dramatic in San Diego County. About 2,600 homes were in foreclosure proceedings at some point between April and June, compared with 945 in the same period last year."

The Sacramento Bee. "After tapping their home values for $22 billion in consumer spending during the recent housing boom, Sacramento-area residents have slowed their use of home-equity borrowing at twice the rate of Californians as a whole."

"The use of home-equity loans or home-equity lines of credit fell by about 10 percent from January through April compared to the same period last year, reported DataQuick."

"It comes after a runup of home-equity borrowing in El Dorado, Placer, Sacramento and Yolo counties that began at $3 billion in 2002 and more than doubled to $7.6 billion by 2005. Statewide, home-equity borrowing fell 5.2 percent during the first four months of 2006, to $39.6 billion. Analysts blame the decline on stagnating home values and rising interest rates."

"'Keep an eye out. It's going to get worse and worse,' said Christopher Thornberg, senior economist of UCLA's Anderson Forecast. Describing most potential borrowers, especially in regions like Sacramento, Thornberg said: 'Their home appreciation has gone to zero.'"

"Despite the drop, more than 27,000 homeowners in the eight-county area borrowed nearly $2.5 billion against their home values from January through April. Mortgage strategist Angela Talent said she has received more, not fewer, requests for home equity loans in recent months. Many applicants, she said, are financially stressed and need to rein in credit card and other debt."

"Even amid rising interest rates, home-equity loans are still far cheaper than credit cards, and interest rates are often deductible from federal taxes."

"That's why (banker) Andrew Mastorakis believes the loans will prevail, even reaching into 40 percent to 50 percent of households within five to 10 years. Currently, about one-fourth of households use home equity lines of credit or loans, he said. 'I think it's a temporary setback,' he said of the decline."