Foreclosure listing firm RealtyTrac says in February, Stockton had the fourth highest rate of foreclosures in the United States. One-in-every-177 housing units received a foreclosure notice last month. RealtyTrac's Daren Blomquist says rates are actually dropping.

"In Stockton, just like in Califonria overall, we are continuing to see a decrease, an 18% decrease in Stockton in foreclosure activity from a year ago."

But he says Stockton hit such high levels of foreclosures during the peak of the housing crisis, it's going to take a while for the rates to come down. As for the Capital City:

"Sacramento's just behind Stockton, ranked number five among metro areas nationwide in terms of foreclosure rate with one-in-every-210 housing units receiving a foreclosure notice during the month."

That's down 9% from a year ago.

Blomquist says lenders are still catching up on processing distressed properties…but he says California is passed the worst.