Home foreclosures rise fourfold in Hub

The number of Boston residents who lost their homes in foreclosure was four times greater last year than in 2005, according to a new report, and the rate is accelerating this year.

Lenders seized 261 residential properties last year from homeowners who fell behind on their monthly payments, up from 60 in 2005, according to an analysis by the city’s Department of Neighborhood Development.

This year the city is on pace to exceed 2006 numbers: by April 13, there were already 114 foreclosures.

The numbers are still much lower than the 1,700 foreclosures in Boston in 1992, when the technology-based economy ran aground and some property values were cut in half. But Mayor Thomas M. Menino said he is concerned about the current figures, fueled by the rising delinquencies of risky subprime mortgages.

‘‘It’s not just a Boston problem. It’s a nationwide problem,’’ he said. ‘‘We need state help. We need federal help.’’

Menino’s office is scrambling to introduce programs to help those at risk of losing their homes. In October, the Department of Neighborhood Development began rolling out services to refinance high-cost subprime loans or counsel those who have already entered the foreclosure process. In May, the city will begin seminars for homeowners at risk of foreclosure — mailing invitations to all residents who have a subprime loan.

For fiscal 2008, Menino has asked for $950,000 for foreclosure prevention in the city budget. The mayor has also introduced a bill in the state Legislature that would impose a 60-day freeze on any action by lenders after they file the initial foreclosure notice.

Most of Boston’s foreclosures last year were clustered in four neighborhoods. Dorchester had the most, 76, followed by Roxbury, 57, Mattapan, 36, and Hyde Park, 26, according to the city report.

Mona Fuller barely escaped foreclosure after falling behind on her payments. Fuller, an event coordinator for the Harvard School of Public Health, and her mother, a Boston school bus driver, both contributed to paying the loan on their $264,000 Dorchester four-bedroom house, where Fuller’s two children and her brother and his son also live.

Fuller said they missed two of their $2,100 payments last fall, and then the lender, GMAC Mortgage, stopped accepting their payments when they did send them. She said her uncle referred her to the city for help, where a counselor negotiated with the lender to save their house. ‘‘You don’t appreciate things until they’re almost gone,’’ she said.

The foreclosure process is triggered when borrowers are at least 30 days late on a payment. The mortgage company must notify the state’s Land Court of its intent to foreclose, and it typically sends a letter to the borrower. Not all homeowners who receive notices lose their homes. They can either try to renegotiate the loan or sell the house to pay if off. But declining home values have closed off these options for many.

Of the Boston residents who faced foreclosure last year, just under half had purchased their homes with mortgages from five major lenders that specialize in subprime loans, the city said: Ameriquest Mortgage Co.; Fremont Investment & Loan; Meritage Mortgage Corp.; Option One Mortgage Corp., a subsidiary of H&R Block; and New Century Mortgage, which filed for US Bankruptcy Court protection earlier this month. More than 30 lenders nationwide have halted operations or have been sold because of increasing subprime loan delinquencies.

Subprime loans target home buyers with poor credit histories or big credit card bills, charging high interest rates to compensate for the increased risks the lender faces. While helping those who might not have been able to buy a home, the $600 billion market in recent years has saddled as many as 2 million Americans with payments that increase sharply after two years, often making the loans unaffordable.

Matthew Shepherd, spokesman for Meritage Mortgage Corp. in Portland, Ore., said his company has helped foreclosure counselors working for the City of Boston contact investors who now hold mortgages in foreclosure so they can help the homeowners save their properties. Meritage, he said, takes seriously its responsibility to help borrowers find a mortgage they can afford, ‘‘but there’s also a responsibility on the borrower’s part.’’

Ameriquest and Option One said they are also trying to help borrowers in trouble, and Fremont, which plans to sell its subprime unit, said it tightened its requirements for mortgage applications last year.

While foreclosures affected only about 1 percent of owner-occupied housing in Boston’s hard-hit neighborhoods, William Apgar, senior fellow at Harvard University’s Joint Center for Housing Studies, said the potential remains for the problem to further depress prices in subsections of these neighborhoods, as happened in Chicago, Atlanta, and Cleveland.

Last year, the median price for a single-family house in Roxbury, Mattapan, and Dorchester declined between 7 percent and 8 percent. When lenders seize properties, they auction them for sale, often at bargain prices, which can drive down the sale prices of other properties on the market.

‘‘It’s going to add to the problems,’’ Apgar said.

The city report did not analyze the race of those who lost their homes, but federal mortgage data for Boston indicate that about half of middle-class African-Americans and Latinos used subprime loans to purchase homes in 2005.

‘‘There is no question that you see a disproportionate number of minority homeowners who are being foreclosed on,’’ said Bruce Marks, chief executive of Neighborhood Assistance Corp. of America, or NACA, a nonprofit agency that has raised $9 billion from Bank of America Corp. and Citigroup to provide mortgages for moderate-income workers.

But last week, NACA said it would use $1 billion of that to refinance mortgages nationwide to reduce homeowners’ payments. Marks is also trying to build a grass-roots movement to demand help for borrowers. He is asking borrowers to come to NACA’s 33 US offices, including Boston, tomorrow to organize.

‘‘We need to work together to protect each other and the communities from these predatory lenders,’’ he said.

Kimberly Blanton can be reached at blanton@globe.com.