Percent of foreclosures that result in home loss continues to worsen
Discovery Bay, CA, July 15, 2008 - ForeclosureRadar, the only website that tracks every California foreclosure with daily auction updates; today issued its California Foreclosure Report. Noted in the report was a minor decrease in the number of homeowners entering the foreclosure process. This marked the fourth month new Notices of Default remained essentially level. Since foreclosure sales can be postponed up to one year in California, the percentage of defaults that result in home loss takes time to determine. Looking back one year to defaults filed in June 2007, 60 percent of those defaults resulted in the property being sold at foreclosure auction. Since that time default filings have increased 88.8 percent, while properties sold at auction have increased 248 percent. The difference between these increases speaks clearly to the issue that for most homeowners there is no way out, and while defaults may be stabilizing, the impact on homeowners and lenders continues to worsen.
High-level findings include:
- Notices of Default declined for the second month, though by just 2 percent, to a total of 42,151 filings. This represents $16.95 Billion in loans.
- Notices of Trustee Sale, which follow the notice of default by an average 105 days and set the date and time of the foreclosure auction, rose again to 35,544 filings, an increase of 2.8 percent over last month's record.
- Sales at auction decreased 4.8 percent, despite past increases in notices of trustee sale, to a total of 24,286 properties with a combined loan balance of $10.25 Billion. Of those, 23,526 received no bid higher than the lenders' opening bid and became bank owned (REO).
- Sales to 3rd parties at auction continued to increase, and were up 9.8 percent from the prior month. 3rd Party purchases, which must be paid in full at the time of auction, exceeded $180 Million. The percent of properties returned to the lender decreased to 96.8%, the lowest it has been since last October.