The foreclosure crisis seems to be easing throughout the Northern San Joaquin Valley.</p><p>Fewer homes are being repossessed and fewer homeowners are being threatened with foreclosure this summer compared to last. The percentage of delinquent mortgages also has declined for five straight months.</p><p>Don't celebrate yet. </p><p>The region's foreclosure rates remain among the highest in the nation, and a staggering number of homeowners have stopped paying their home loans.</p><p>But relatively speaking, things are better.</p><p>Merced, Stanislaus and San Joaquin in July were ranked among the country's six worst counties for foreclosure filings by RealtyTrac, a national foreclosure monitoring service. </p><p>Frequently during the last four years, Northern San Joaquin Valley counties have ranked first, second and third on that dubious list. Las Vegas currently holds the title for having the highest foreclosure rate. </p><p>Since the foreclosure mess started in fall 2006, about 21,000 Stanislaus properties have been lost to foreclosure. That's nearly one in eight homes. </p><p>Those foreclosed homeowners walked away from about $7 billion in unpaid mortgages.</p><p>In Merced County, more than 11,000 homes were lost, leaving nearly $5 billion in unpaid mortgages. In San Joaquin County, more than 27,000 homes were lost, leaving more than $11 billion in unpaid mortgages.</p><p>Activity at all steps of the foreclosure process has been easing this year in Merced and San Joaquin counties. Stanislaus County, however, has witnessed the most improvement.</p><p>"Stanislaus County is further through the process than the rest of California," said Sean O'Toole, whose company ForeclosureRadar tracks homes in mortgage default throughout the state. "We are going to continue to see a general decline in foreclosure activity there."</p><p>Only 483 Stanislaus properties were lost to foreclosure during July -- 373 repossessed by lenders and 110 sold in foreclosure auctions on the courthouse steps, according to ForeclosureRadar stats. That's less than half as many Stanislaus homes as were lost during July 2008 when the crisis peaked in the area.</p><p>Also encouraging is the drop in the number of homes entering the foreclosure process. This July, 591 Stanislaus properties received notices of default, the first step in the drawn-out legal process. Last July, there were 1,081 such notices issued.</p><p>That 45-percent drop indicates foreclosures should continue declining.</p><p>CoreLogic, another national real estate tracking company, also shows improvement for Stanislaus in the percent of homeowners behind on their mortgage. </p><p>As of June, 14.9 percent of Stanislaus homes with mortgages were more than 90 days late on payments. During January and February, the delinquency rate topped 16 percent. </p><p>By comparison, nationwide 8 percent of those with mortgages are late on payments. Statewide, it's about 10.4 percent.</p><p>Traditionally, mortgage lenders started foreclosure proceedings on homes that were 90 days delinquent. That's not always the case anymore.</p><p>"Banks randomly foreclose on people (who haven't paid their mortgages) just to keep other folks with mortgages paying on time. That's the only logical conclusion I can come to in this market," said O'Toole, noting how many delinquent borrowers allowed to stay in their homes for more than a year without the foreclosure process being started. "Banks foreclose more quickly on lower-end properties than on higher-end properties, because the financial losses are lower."</p><p>Modesto Bee reporter J.N. Sbranti can be reached at (209) 578-2196 or jnsbranti@modbee.com.