Trustee Sale Investors Kickoff the New Year with Near Record Activity

Real Estate investors started off 2012 with a bang. Sales to Third Parties, typically investors rose significantly in January throughout our coverage area, with the exception of Washington. California saw the most activity, with investors purchasing 3,964 properties for $766.2 million. Note that trustee sale investors must pay in cash, in full, with no title insurance or inspections prior to purchase. This is the fourth largest month on record in California, and the busiest since March of 2011.

Nevada saw the largest month-over-month increase in Foreclosure Sales, with investors there purchasing 973 properties for $99.1 million. This increase, coupled with the dramatic decline in new foreclosures that began in October 2011, is quickly depleting the foreclosure inventory that remains scheduled for sale in Nevada. Year-over-year the number of Nevada properties scheduled for sale has dropped 57.6 percent.

Despite what appears to be significant percentage increases in Foreclosure Starts in California, Nevada and Washington, these increases barely offset the declines seen over the holidays. Compared to January one year ago, Foreclosure Starts are significantly lower now – despite the fact that many banks were still under self-imposed moratoriums due to robo-signing last year.

“January’s numbers should put to rest any notion that we will see a wave of foreclosures in 2012, at least in the western states that we cover.” Stated Sean O’Toole, Founder & CEO of ForeclosureRadar. “Foreclosure Starts remain near record low levels, significantly lower than a year ago, when many banks still had self-imposed moratoriums in place due to the robo-signing scandal. Add to that a foreclosure timeframe of more than 8 months, and there is little chance of a wave this year even if all the banks started the foreclosure process en masse tomorrow.”

CLICK HERE for our complete January 2012 Foreclosure Report

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2011 Foreclosure Activity Ends With a Whimper

Foreclosure Starts dropped significantly throughout our coverage area with the exception of a modest increase in Oregon. Foreclosure Sales were mixed, and down far less than we expected given lender announcements of holiday moratoriums. California and Washington actually saw modest increases. Also surprising was a drop in the time to foreclose across most states, since foreclosures typically get extended over the holidays.

An event of particular note this month was an unexpected spike in the Cancellations of foreclosure in California, with an increase of 45.8 percent from the prior month. Almost the entire increase occurred in Los Angeles County where over 5,000 sales were cancelled. This looks to have been caused by a city ordinance eliminating the trustee sale location in Norwalk. We expect many of the cancelled sale dates to be reissued at a new location within the county soon.

Nevada’s new foreclosure law, which caused Foreclosure Starts to plummet in October, are now impacting Foreclosure Sales as well. We’ve seen foreclosure activity bounce back after lenders deal with state law changes in the past, but its less clear that we’ll see such a recovery in Nevada anytime soon.

“Nevada’s new foreclosure rules appear on track to bring a near complete halt to foreclosures in that state.” stated Sean O’Toole, Founder and CEO of ForeclosureRadar. “In the near term this will certainly help homeowners who were facing foreclosure, eviction, and potentially deficiency judgements. Longer term, we believe there will be unintended consequences for the state as business declines for the many real estate related companies that would normally service, resell and finance those foreclosures. While we hope the rules will lead to better lender accountability as intended, we fear that they will instead lead to higher unemployment and less certainty as to when the cloud of ‘shadow’ inventory hanging over the state will be lifted.”

CLICK HERE for our complete December 2011 Foreclosure Report

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Foreclosure Sales Slow for the Holidays, While Lenders Prepare for 2012

It is not unusual to see foreclosures slow for the holidays, and the this year is no exception. Foreclosure starts were up slightly in Nevada and Washington, but the increases were insignificant given the recent declines in those states due to legislative changes and legal challenges. Foreclosure Sales rose only in Arizona, but that increase simply offset the drop seen in October and is still well below average monthly sales for the year there.

Notice of Trustee Sale filings rose 34.7 percent from October to November in California. The increase came primarily from filings by Bank of America, up 52 percent, and Wells Fargo, up 23 percent. It is not unusual to see an increase in foreclosure sales each January, and these filings would be necessary in preparation for that.

Sales to 3rd parties, typically investors, have increased significantly year-over-year. The largest increases we’re seen in Arizona and Nevada at 101.6 and 79.9 percent respectively. Other states saw increases as well: California 29.4 percent and Washington at 6.7 percent.

“It’s great to see the banks slow down foreclosures and evictions for the holidays.” stated Sean O’Toole, Founder and CEO of ForclosureRadar. “We expect that the numbers will drop even further in December. Come January, it will be back to business with at least a small surge as banks play catch up after the delays.”

CLICK HERE for our complete November 2011 Foreclosure Report

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Little Change in California, as Nevada and Washington Foreclosure Starts Plummet

Foreclosure Starts in California were little changed this month, after a dramatic increase in August and subsequent fall in September. Other California foreclosure activity was also little changed in October. California foreclosure investors gained traction with 9.9 percent more properties sold to third parties in October, representing a record 28.8 percent of all foreclosure sales. A year ago just 16.9 percent of foreclosures were purchased by third parties.

Nevada Foreclosure Starts plummeted in reaction to the passing of AB 284, which imposed stricter requirements on filing new Notices of Default, and seems to have specifically targeted ReconTrust – the trustee that handles all Bank of America and Countrywide foreclosures – by prohibiting a trustee from being owned by the foreclosing lender, as ReconTrust is. Washington Foreclosure Starts continued their decline after being impacted by a lawsuit filed by the State Attorney General against ReconTrust in August alleging the trustee was illegally foreclosing on properties in that state.

Elsewhere, Arizona foreclosure starts are at the lowest levels since spring of 2009, with just 6,133 Notice of Sale filings in October. This is seen throughout the state, as cancellations, properties sold to the bank and those sold to third parties are all down. Oregon Foreclosure Starts continue their drop from the April spike, down 20.6 percent in October.

“I find it amazing that so many believe that legislation and lawsuits targeting the foreclosure process are a win for homeowners.” stated Sean O’Toole, Founder and CEO of ForeclosureRadar. “The reality is these delays help the banks by allowing them to keep bad loans on their books at inflated values, while leaving in limbo the millions of homeowners that are already in default. The housing market will not recover until we move beyond these delay tactics.”

CLICK HERE for our complete October 2011 Foreclosure Report

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Foreclosure Starts Driven Higher by Bank of Americas

Foreclosure filings and sales increase throughout most of our coverage are in August. Foreclosure starts jumped significantly, reversing what had been a declining trend over the past several months. Investors bought more properties on the courthouse steps in August than in July everywhere except in Washington. The number of properties Sold Back to Bank jumped significantly in Oregon, and also rose in California and Nevada.

Foreclosure starts (the first notice filed, either a Notice of Default or Notice of Trustee Sale depending on the state) rose in every state. This appears to have been primarily driven by Bank of America and related entities, where we saw an overall 116 percent increase from July to August. Wells Fargo and US Bank also saw an increases in foreclosure start filings, while filings by JP Morgan Chase and Citibank were essentially flat.

Key month over month trends for August include:

 
CLICK HERE for our complete August 2011 Foreclosure Report

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