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Foreclosure Filings are Down as the Time to Foreclosure Speeds Up In Some States
On average it took less Time to Foreclose in California, Arizona, and Nevada in June 2011, countering what has been a growing trend to extend the foreclosure process. The time to foreclose has increased on a year-over-year basis throughout our coverage area, with the largest increase seen in Nevada where it now takes on average 319 days to foreclose, up from 239 days a year ago. California saw the second most significant increase with the average time to foreclose at 317 days, up from 261 days a year ago. The least change was observed in Washington where the average time to foreclose is 106 days, only slightly higher than the 105 days seen a year ago.
Foreclosure filing activity was down throughout our coverage area in June 2011, with fewer foreclosure filings in all states. There were fewer foreclosure sales, both Back to Bank and Sold to 3rd Parties everywhere except Oregon which saw an uptick in activity at the courthouse steps.
"While the decrease in the time to foreclose last month is statistically interesting," says Sean O'Toole, CEO, and Founder of ForeclosureRadar, "We do not see it as signaling an end to lenders looking to avoid losses that they can't afford by continuing the extend and pretend policies of the past."
Notice of Trustee Sale filings was down 8.7 percent in June 2011 from the prior month and dropped 33.7 percent year-over-year, continuing the downward trend seen since the beginning of the year. Foreclosure sales Back to Bank were down for the third consecutive month, with a 16.6 percent drop in June from May and a 30.9 percent drop year-over-year. Foreclosures Sold to 3rd Parties, typically investors slowed as well with a 7.9 percent drop month-over-month. The time to foreclose decreased in June to 165 days down 7.3 percent from May. The time to resell for banks (REO) took longer, up 4.6 percent month-over-month and 27.2 percent year-over-year.
California saw slowed foreclosure activity across the board. Notice of Default filings fell for the third consecutive month after a slight 1.5 percent drop in June. Notice of Trustee Sale filings was down in June as well, with an 11.7 percent decline month-over-month and a 34.3 percent drop from June 2010. Cancellations of foreclosure sales decreased for the second time in as many months, with a 3.0 percent drop compared to May. Foreclosure sales on the courthouse steps were slower than the prior month, with 13.4 percent fewer sales Back to Bank and 7.1 percent fewer foreclosed properties Sold to 3rd Parties. For the first time in six months the average time to foreclose decreased, down 7.9 percent to 317 days month-over-month but remained up 21.5 percent as compared to this time last year. Third parties continued to resell inventory more quickly, with the time to resell down 1.5 percent month-over-month to 131 days, clearly outperforming banks, which took an average of one hundred days longer at 231 days to resell inventory (REO).
Notice of Default filings in Nevada was nearly flat in June and remain at the lowest level since our tracking of Nevada foreclosure filings began in August 2009. Notice of Trustee Sale filings fell 7.2 percent month-over-month to the lowest level in fifteen months. Activity slowed further on the courthouse steps in June, with sales Back to Bank down by 25.0 percent, and properties Sold to 3rd Parties off by 12.4 percent from May. Despite the month-over-month drop, Sales to 3rd Parties and those Back to Bank remained above last year, up 20.7 percent and 5.0 percent respectively from June 2010. Cancellations dropped 6.4 percent in June from the prior month to the lowest level since May 2010. The time to foreclosure decreased 5.0 percent month-over-month to 319 days but remained 33.5 percent higher than this time last year. The time to resell for 3rd Parties declined to 98 days falling to double digits for the first time since August 2009 when we began tracking foreclosure sales in Nevada.
Oregon saw a 29.6 percent drop in Notice of Default filings in June 2011, which erased the spike in April when ReconTrust, a subsidiary of Bank of America, temporarily increased filings. Cancellations fell 19.0 percent to the lowest level since September 2009. Properties sold Back to Bank rose 2.0 percent month-over-month, but remain down 57.1 percent from a year ago. Properties Sold to 3rd Parties increased 18.9 percent month-over-month.
Washington saw a 2.4 percent drop in Notice of Trustee Sale filings from May, the third consecutive month of declines. Foreclosure sales Back to Bank (REO) dropped a significant 19.8 percent in June from May, with properties Sold to 3rd Parties close to flat month-over-month. The Time to Foreclose fell 4.5 percent from the prior month and was nearly level year-over-year.