According to the latest report from ForeclosureRadar, Notices of Defaults (NOD) or the beginning of the foreclosure process have decreased 48.1 percent from this same time a year ago for the month of September and are down 20.7 percent from August.
A large percentage, 39.2 percent, of the homes that were foreclosed on or also known as a trustee sale, went to investors and not back to the bank or beneficiary which is up from 27.2 percent for the same time a year ago. Basically we are seeing more investors at the auctions buying up the foreclosed homes.
Sean O'Toole, founder & CEO of ForeclosureRadar said that "it was recently reported that the nation's five largest mortgage servicers have implemented all of the 320 servicing standards required under the national mortgage settlement,” and he went on to say that “the continued decline in foreclosure starts clearly shows that even though servicers are now apparently in compliance and clear to move forward with foreclosures, they are still in no rush to foreclose on the majority of delinquent borrowers.”
The foreclosure process in California is that anytime a home owner is more than 30 days behind on their home loan payments their lender can file a NOD. A NOD is a 90 day notice from the home owner’s lender for the home owner to get current on their home loan. After 90 days the lender can then file a notice of trustee sale (NOT) which is a 21 day notice that the lender, under the State foreclosure laws, is going to auction off the home to the highest bidder. After which the home owners home can legally be auctioned off at the court house steps.
From what I have personally seen as the leading factor of the decline in foreclosures is the lender’s willingness to work with distressed home owners. I have personally seen lenders forgive 30 percent of the home owner’s loan balance owed and reduce interest rates, this byproduct is lower monthly payments for the home owners. Which allows the home owner the ability to stay in their homes or maybe better said, to keep their homes.