New notices of default in Orange County in January dropped 29% compared to last January, though they increased slightly from December, 2009, according to ForeclosureRadar.com.
But new notices of trustee sales — homes headed to foreclosure auctions — went up 20% from last January, though they were down compared to December.
Here’s how the O.C. numbers shake out:
Statewide, “With hundreds of thousands of California homeowners in foreclosure a stalemate continues as only a small percentage reach the end of the process through cancellation or sale and the time to foreclose increases,” says Sean O’Toole, founder and CEO of ForeclosureRadar. “With delinquent payments rising, foreclosures slowing, and foreclosure alternatives failing, it appears the foreclosure crisis will be with us for many years to come.”
O’Toole and others say just a portion of borrowers are getting loan modifications and are able to avoid losing their homes. Critics of these workout attempts have dubbed them ”extend and pretend.”
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O’Toole has come up with a new calculation: “Time to foreclose.” It measures the difference between the date the initial notice of default is recorded and the date the property was sold at the foreclosure auction.
He says statewide, time to foreclose has increased from 146 days in August 2008 to 229 days in January 2010.
I asked top REO broker Tom Moon, to weigh in on the O.C. data. He said:
“Prior to a homeowner receiving an NOD, the bank MUST try to contact the homeowner many times, for 90 days, prior to filing the NOD. This is not to be confused with the initial 4 to 6 months of non payment it finally takes for the bank to take action.
“With banks now waiting an additional 90 days to file NODs, this is going to backlog the NODs 90 days. So call this period a 90-day grace period and the eventual NODs may catch up thereafter.
“Bottom line, banks are afraid to be criminally prosecuted for not being able to prove they did every thing in their power to attempt a loan modification for those 90 days.”