Foreclosure Filings down in April

ForeclosureRadar (www.foreclosureradar.com), the only website that
tracks every California foreclosure and provides daily auction updates, issued its monthly California Foreclosure Report for April 2010. Foreclosure filings were down in April for the first time since the beginning of the year. Despite the decline in filings, the inventory of properties in preforeclosure or scheduled for sale only dipped slightly as the drop in filings were offset by an increase in the time to foreclose. Cancellations continue to climb, up more than 32 percent from the beginning of the year. The number of properties sold to 3rd parties also continues to climb, helped again this month by slightly better
discounts.
“The steady rise in cancellations leads us to believe that loan modifications and short sales are gaining traction” says Sean O’Toole, Founder and CEO of ForeclosureRadar.com. “I’d caution, however, that cancellations also occur due to filing errors and extended postponements, which require the Notice of Trustee Sale to be re-filed. In fact, 14.6 percent of new Notice of Trustee filings in April were on previously
cancelled foreclosures.”

Notice of Default filings are the first step in the foreclosure process. Notice of Trustee Sale filings set the date and time of auction and serve as the homeowner’s final notice before sale.
Foreclosure Filings Foreclosure Cancellations Continue to Climb Short sales and loan modifications are not the only explanation

After the filing of a Notice of Trustee Sale, there are only three possible outcomes. First, the sale can be Cancelled for reasons that include a successful loan modification or short sale, a filing error, or a legal requirement to re-file the notice after extended postponements. Alternatively, if the property is taken to sale, the Bank will place the opening bid. If a 3rd party, typically an investor, bids more than the bank’s opening bid, the property will be Sold to 3rd Party; if not, it will go Back to Bank and become part of that bank’s REO
inventory.

Preforeclosure inventory is an estimate of the number of properties that have had a Notice of Default filed against the property, but have not yet been Scheduled for Sale. The Scheduled for Sale inventory indicates those properties that have had a Notice of Trustee Sale filed, but have not yet been sold or had the sale
cancelled. The Bank Owned (REO) inventory indicates the number of properties that have been sold Back to Bank at the trustee sale, and which the bank has not yet resold to another party.