California Home Foreclosure Notices Decline 12% as Lenders Change Policies
Foreclosure notices in California, the state with the highest number of distressed mortgages, fell in the fourth quarter as the housing market improved and loan servicers changed their policies, DataQuick said.
A total of 61,517 notices of default were recorded in the three months ended Dec. 31, down 12 percent from a year earlier and 14 percent from the previous quarter, the San Diego-based real estate information provider said today.
“We are certainly seeing a lower level of foreclosure activity than a year or two ago,” DataQuick President John Walsh said in the statement. “The question is, how much of that decline is due to market conditions, and how much is due to policy changes that try to address economic distress and lower home values?”
Sales involving homes with delinquent mortgages increased last month as lenders pushed to “move them off their balance sheets before the end of the year,” according to a report today by the California Association of Realtors. Short sales, in which lenders let homeowners sell for less than the mortgage balances, accounted for 22.2 percent of December transactions, up from 21 percent in November. Bank-owned homes made up 24.6 percent of deals, up from 23.5 percent in November.
A total of 37,734 new and resale houses and condominiums sold in California in December, up 16 percent from the previous month and 4.2 percent from a year earlier, DataQuick reported Jan. 18. Foreclosure filings dropped in late 2010, when lenders faced investigations over accusations they had used improper documentation to seize homes with delinquent mortgages.
Last year, 428,045 California homes received foreclosure filings, accounting for 23 percent of all homes nationwide with a notice of default, auction notice or foreclosure sale, RealtyTrac Inc. reported Jan. 12.
Most of the California loans going into default in the fourth quarter were originated between 2005 and 2007, when home values were at their peak and lenders loosened credit terms, according to today’s DataQuick report. California foreclosure filings peaked in the first quarter of 2009, when 135,431 homes received notices of default, the company said.
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