In the News

Foreclosure sales plummeted in May after federal banking authorities reminded lenders to play by the rules when foreclosing on homes, according to a report released Wednesday.

Sales at courthouse auctions fell from April to May a combined 25 percent in Santa Clara, San Mateo, Alameda and Contra Costa counties, according to PropertyRadar, a Truckee company that tracks distressed property. There were similar declines across California, the company said.

In early May, some of the major lenders “just stopped their foreclosure sales” after receiving a guidance letter from two federal agencies, said Madeline Schnapp of PropertyRadar, which issued the report.

Banks responded differently to the guidance letter sent in late April, said Schnapp of PropertyRadar.

Even though Bank of America, Wells Fargo, JPMorgan Chase and Citi were already operating under the rules, some of them slowed foreclosures temporarily.

JPMorgan Chase halted foreclosure sales briefly and then resumed, Schnapp said. Bank of America “never slowed down,” she said, while Citi’s foreclosure sales were down 50 percent and Wells Fargo’s were down 75 percent.

“We’re assuming Citi and Wells will come back in June,” she said.

ForeclosureRadar®, the most trusted source of California foreclosure information and software announced today that the company has changed its name to PropertyRadar®, effective immediately. The new name coincides with the launch of a new product that provides data, software, and analytics across all California properties, not just those in the foreclosure process.

Foreclosure information and software provider ForeclosureRadar has changed its name to PropertyRadar and expanded its business model to provide analytics across all types of California properties, not just foreclosures.

“Distressed properties are still a major portion of the market and will be with us for many years to come,” said PropertyRadar founder and CEO Sean O’Toole in a statement.

The default servicing space is pulling back a bit as the real estate market recovers, forcing companies to focus less on foreclosure services.

Among those venturing into new territory is Truckee, Calif.-basedForeclosureRadar, a source of foreclosure data for California.

The company just changed its name to PropertyRader to reflect the launch of a new product that will offer data and analytics for all California properties. 

“We are proud that we changed the way professionals operate in the foreclosure marketplace, by providing reliable information on properties in every phase of the foreclosure process, so they can make truly informed decisions.  Now we are excited to do the same for the overall Real Estate market,” said Sean O’Toole, founder and CEO of PropertyRadar.

“A month after nearly halting foreclosure sales in reaction to tighter federal regulation, Wells Fargo & Co. and Citigroup Inc. are still selling seized properties at a sharply reduced pace, according to a research firm that tracks Western foreclosure filings.”

Wells’ foreclosure sales were still “dribbling along” as of this week at a quarter of their former pace, said Madeline Schnapp, director of economics research at PropertyRadar. The Truckee, Calif., firm tracks foreclosures in Nevada, Arizona, Oregon and Washington as well as the Golden State.

“For example,” Schnapp said in an email, Wells foreclosure sales in California totaled “25 during the last week of May compared to over 100 per week prior to the [Office of the Comptroller of the Currency] ruling.”

“Citi’s foreclosure sales the last week of May were 12 compared to an average of 30 per week during the month of April,” she said.

“LADERA RANCH, Calif.—Rising home prices have fueled the return of a practice that some blamed for inflating the bubble: house flipping.”

“In California, the number of homes sold in recent months that had been flipped—or bought and resold within six months—has reached the highest levels since late 2005, according to PropertyRadar, a real-estate data firm. About 6,000 homes have been flipped in the state this year through April, or more than 5% of all homes sold statewide.”

“At first glance, Wednesday’s report that sales of existing homes gained by just 0.6% in April, after adjusting for seasonal factors, seems unremarkable.”

“In California, home sales fell by 4% in April from one year earlier, according to real-estate data firm PropertyRadar, but this headline masks big changes. Distressed-property sales fell by 39.4% from a year earlier, while sales of non-distressed homes rose by 36.6%. When or whether the non-distressed component can offset the decline in the distressed component will be an important milestone in a housing recovery.”

“Some of the nation’s largest banks, including Wells Fargo WFC -0.74% & Co., suspended foreclosure sales in a number of states following guidance issued last month by federal banking regulators.”

“During April, Wells Fargo completed around 80 foreclosures per workday for five Western states–California, Nevada, Arizona, Oregon and Washington–according to data compiled by ForeclosureRadar, which tracks filings in those states. But since May 6, Wells Fargo has completed no more than eight foreclosures on any day.

“The slowdown in foreclosures came as a surprise to market analysts because the OCC’s compliance letter “appears to cover all of these things the banks should have been doing,” said Sean O’Toole, president of ForeclosureRadar.”

“Wells Fargo (WFC) and Citigroup (NYSE:C) have halted the vast majority of their foreclosure sales in multiple states following the release of new guidance by the Office of the Comptroller of the Currency.”

“The abrupt slowdown came in response to the OCC’s April release of minimum standards for foreclosure sales, which are usually the final act in the foreclosure process. The Federal Reserve issued identical guidance to the banks it oversees, making the guidelines universal for the industry.”

“The halt is most dramatic with Wells, the nation’s largest mortgage originator. The bank’s foreclosure sales in five Western states — California, Nevada, Arizona, Oregon and Washington — dropped from as many as 349 a day in April to fewer than 10 a day across the entire region, according to Foreclosure Radar, a California real estate monitoring firm.”

“Among California homeowners encountering foreclosure, those with higher loan amounts tended to hold on to their homes longer than those with lower loan amounts, according to this month’s report from ForeclosureRadar.“

“The firm, which observes foreclosure trends in five Western states, determined a difference in foreclosure timelines of 270 days between loans of less than $417,000 and loans of more than $550,000.”

“This appears to be a relatively recent anomaly, according to ForeclosureRadar’s findings. In January 2009, foreclosure timelines in California for all loan amounts were relatively equal.”

““Perhaps the difference lies in the fact that more affluent homeowners have the means to tap into resources to help delay foreclosure, or that larger loans on expensive homes are more complex and take longer to disentangle,” ForeclosureRadar stated in its report.””