In The News
Foreclosure Sales Slow on West Coast
With the holiday season approaching, the research and tracking firm ForeclosureRadar is seeing declines in the number of completed foreclosures in four of the five states it monitors along the country’s West Coast.
“It’s great to see the banks slow down foreclosures and evictions for the holidays,” said Sean O’Toole, CEO and founder of ForeclosureRadar. “We expect that the numbers will drop even further in December.”
Nevada Foreclosures Plummet as Banks Grapple with State Law
Nevada didn't explicitly forbid Bank of America Corp. from initiating new foreclosures within its borders last month. But it might as well have done so.
B of A completely ceased filing new notices of default in Nevada, in the month following the Oct. 1 implementation of a state law raising the documentary and procedural standards for foreclosures. Other banks cut back heavily as well: overall filings of so-called NOD's in Nevada fell 81% month-over-month, according to data from Foreclosure Radar, which tracks county recorder filings covering the overwhelming majority of the state's population.
One of the provisions of Nevada's Assembly Bill 284, approved in May and implemented in October, hit Bank of America harder than most. The law requires lenders to use an independent foreclosure trustee, which is responsible for administering the foreclosure process and providing notice to the borrower. Unfortunately for Bank of America, a high proportion of its foreclosure actions have historically been taken through a subsidiary called ReconTrust Co.
Now B of A must scramble to find a new trustee to handle its foreclosures. In terms of handling B of A's filings, "the trustee they use to foreclose on all of their loans is basically out of business in Nevada," says Sean O'Toole, founder of Foreclosure Radar.
Investors beating banks at REO game
After millions of dollars in investments, adding thousands of new staff positions and even contracting to third-party brokers, the large banks still can't sell foreclosed properties fast enough to ease the vast overhang of REOs bedeviling their books.
Meanwhile, on the dusty streets of places like Glendale, Ariz.; San Bernardino, Calif.; and Henderson, Nev., independent investors have been buying up defaulted properties, rehabbing them and putting them back into the market at a pace that makes the banks look geriatric in comparison.
"Third-party investors are much faster at reselling foreclosures than banks, though the difference varies by area," said Sean O'Toole, founder and CEO of ForeclosureRadar.
Nevada Foreclosure Filings Dry Up After ‘Robo-Signing’ Law
Foreclosure filings in Nevada plunged in October during the first month of a new state law stiffening foreclosure-processing requirements.
Slightly more than 600 default notices were filed against homeowners through Oct. 25 in the state’s two most-populous counties, Las Vegas’s Clark County and Reno’s Washoe County. That was down from 5,360 in September, or an 88% drop, according to data tracked by ForeclosureRadar.com, a real-estate website that tracks such filings. Default notices represent the first step in processing foreclosures.
“It leaves this shadow,” says Sean O’Toole, president of ForeclosureRadar. “If you’re a buyer, and you don’t know when or how that market’s going to clear, it’s not going to leave you a lot of confidence in investing in that area.”
After Big Jump in August, Foreclosure Starts on West Coast Fall Again
New foreclosure actions in states along the country’s West Coast returned to levels in line with prior months during September, according to ForeclosureRadar, a California-based company that tracks every foreclosure in its five-state coverage area.
“While foreclosure activity returned to its normal course in September, we fully expect to see more volatility like we saw in August as banks continue to work in fits and starts through robo-signing and other issues,” said Sean O’Toole, founder and CEO of ForeclosureRadar.
“It’s almost unfathomable that four years into this crisis there would still be so much uncertainty on how to best deal with the trillions in bad mortgage debt that was created during the credit bubble,” O’Toole added.
HOUSING: The bigger the loan, the longer to foreclose
When it comes to foreclosing, lenders see some delinquent homeowners as more equal than others.
Sean O'Toole, founder of ForeclosureRadar, figured out how to show that banks were going easier on bigger borrowers when he analyzed all California foreclosures. He said the change in accounting policy caused banks to be tougher on people with the smallest loans. He said banks avoided taking losses on big loans the longer they delayed foreclosures.
West Coast States See a Surge in New Foreclosures
Foreclosure starts soared during the month of August in states along the country’s western coast, reversing what had been a declining trend over the past several months, according to the tracking firm ForeclosureRadar.
“Bank of America appears to be primarily responsible for the surge in foreclosure starts this month,” said Sean O’Toole, founder and CEO of ForeclosureRadar. “Since their average time to foreclose has recently increased to more than a year, it is unclear that these foreclosure starts will lead to an increase in foreclosure sales anytime soon.”
Investors Outdo Banks Offloading Distressed Properties: Report
Third-party investors are much faster at reselling foreclosures than banks, according to ForeclosureRadar, a California-based tracking firm.
ForeclosureRadar keeps close tabs on foreclosure activity in states along the country’s western seaboard, and the company says one market dynamic that it’s found to be consistent throughout the area is that investors are moving foreclosed homes at a more rapid pace than lenders who take possession of REOs.
Armed with this information, O’Toole takes issue with the government’s recent push to turn foreclosed homes into rental properties.
Real estate investor activity mixed in top 10 West Coast trustee's sale markets
In compiling the "10 Best Markets for Real Estate Investors" report, Inman News reached out to a range of data providers and online real estate sites that supplied statistics and charts to identify real estate markets that may be well-suited for investors.
ForeclosureRadar compiled data showing the change in investor activity at trustee's sales for the 10 largest trustee's sale markets on the West Coast (within its five-state coverage area of Arizona, California, Nevada, Oregon and Washington). Activity increased in four markets from first-quarter 2010 to first-quarter 2011 and declined in six.
Foreclosures are not going go away anytime soon
When it comes to foreclosures and short sales, there is not much good news on the horizon, a foreclosure data expert said last week. Michelle Lenahan, director of customer service and training for ForeclosureRadar, said real estate professionals have become more valuable today than in the past because these types of transactions aren't going away anytime soon. In fact, sharing valuable information on these types of transactions is a great way to start a conversation with clients, she said.
Examining trends in foreclosure and bank-owned properties in the Bay Area, Lenahan said news that delinquencies are down and the foreclosure rate is flat is deceiving because there are 2.2 million homes under water. One million homes are currently in some stage of the foreclosure process, and it could take as long as 50 months to get them through the market. "This means we're not even going to see a recovery until 2014," she said.