BUSINESS WATCH:

It’s been a tough few months for Orange County homeowners, and no area is feeling the brunt worse than the Westside of Costa Mesa.

The 92626 zip code, which comprises the western end of the city, had the biggest increase in foreclosures last quarter of any zip code in the county, according to the statistical firm DataQuick. (The neighborhood commonly referred to as the Westside falls under the 92627 ZIP code.)

The area posted only a single foreclosure in the fourth quarter of 2006, but that number rose to a whopping 29 in the fourth quarter of 2007 — leading Orange County with a 2,800% increase.

Nearly every part of the county had an increase in foreclosure. Costa Mesa Realtors surmised the Westside’s high amount was the result of a large number of first-time buyers who, in some cases, may not have completely understood the loans they took out.

“There’s a lack of consumer education,” said Galel Fajardo, president of the Coast Mortgage Group. “We have not taught people the basics of personal finances, so they’ll go online and shop for a mortgage. I tell people, ‘Even if you don’t go with us, go with somebody you know. Go with a certified mortgage professional.’”

Elia Ceniceros of Weichman Associates Realtors recommended prospective home buyers check with the California Department of Real Estate or local realty boards to check an agent’s credentials. Part of the problem, she and Fajardo said, was many first-time home buyers were recent immigrants, and small-time lenders sometimes coaxed them into taking out loans they were unable to pay off.

“There’s a lot of unscrupulous and unethical agents out there that may have done that to clients, but the problem is that when the client turns around and needs the agent to help them, the agent is no longer in the business,” Ceniceros said.

For homeowners unable to make payments, foreclosure isn’t the only option. Valerie Torelli, who owns Torelli Realty in Costa Mesa, said she had a number of homeowners come to her asking for help with short sales, in which a bank agrees to resell a house for a price lower than the initial loan.

The problem, she said, was not restricted to low-income buyers; many more affluent ones had pushed their luck in recent years because they expected the market to keep improving.

“Even people who have really good income got sucked into this, too,” Torelli said. “They kept buying houses they couldn’t afford.”

MICHAEL MILLER may be reached at (714) 966-4617 or at michael.miller@latimes.com.