California State Senate Bill 1137 takes effect, dramatically impacting foreclosure filings
Discovery Bay, CA, October 13, 2008 - ForeclosureRadar, the only website that tracks every California foreclosure with daily auction updates; today issued its California Foreclosure Report for September 2008. Notice of Default filings, which indicate the start of the foreclosure process, fell 61.8 percent in September due primarily to new legislation that went into effect on September 8th. California State Senate Bill 1137 imposes significant new requirements on lenders prior to filing for foreclosure, and the drop indicates that the lenders were not ready for the impact. The bill also effected new Notice of Trustee Sale filings, which dropped 47.3 percent from August. The bill did not directly impact foreclosure sales; however, they still fell by 12.4 percent.
High-level findings include:
- Only 16,352 Notices of Default were filed in September, down from 42,790 in August, a decrease of 61.8 percent from August 2008, and a decrease of 36.4 percent from a year earlier.
- Notices of Trustee Sale filings decreased 47.3 percent from August, to a total of 19,116 filings. Despite the significant decline, filings increased 33.9 percent from September 2007.
- Properties taken to sale at auction increased 163.2 percent from the prior year, to 23,409 sales, with a combined loan balance of $9.75 Billion. This represents a 12.4 percent drop from August 2008.
- Lenders took back 95 percent of the properties taken to auction, with a combined loan value of $9.19 Billion. Third party purchases were flat from the prior month, but increased slightly as a percentage, due to the decline in sales activity.