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Foreclosure starts down sharply in December
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LAS VEGAS REVIEW-JOURNAL
Foreclosure starts in Nevada dropped significantly in December, along with time to foreclose, which normally gets extended during the holidays, ForeclosureRadar.com reported Thursday.
In Clark County, notice of default filings fell to 923 in December, an 82.5 percent decrease from 5,277 in the same month a year ago, the Discovery Bay, Calif.-based online listing service reported.
Since a Nevada law took effect in October requiring lenders to prove they have authority to foreclose, default filings have hovered around 1,000 a month.
There were 3,140 notices of trustee sale during the month, roughly half of the 6,089 in December 2010.
Foreclosure sales were mixed across all Western states, down far less than expected given lender announcements of holiday moratoriums, ForeclosureRadar Chief Executive Sean O'Toole said.
Nevada's new foreclosure law, which caused default filings to plummet in October, is now trickling down to foreclosure sales as well, he said.
Foreclosure activity bounced back after lenders dealt with state law changes in the past, but it's less clear that such a recovery will happen soon in Nevada, O'Toole said.
"Nevada's new foreclosure rules appear on track to bring a near-complete halt to foreclosures in that state," the foreclosure expert said Thursday. "The only foreclosures you have now are homeowner association liens. There may be a few others, but as we look through December, the vast majority are foreclosures by HOAs, not lenders."
O'Toole said he hopes the rules lead to better lender accountability, as intended, but he said he fears they will instead lead to higher unemployment and less certainty as to when the cloud of "shadow inventory" hanging over the state will be lifted.
In the near-term, the law will certainly help homeowners who were facing foreclosure, eviction and potentially deficiency judgements. Longer term, O'Toole said, there will be unintended consequences for the state as business declines for real estate-related companies that service, resell and finance those foreclosures.
"The changes they put in place are pretty significant," he said. "Look at Bank of America with Recon Trust. They had to rebuild their whole foreclosure process because the trustee can't be owned by the lender."
Cancellations fell 60 percent to 1,083; back to bank, or actual foreclosures, fell 43.6 percent to 925, and sales to third party increased 10.6 percent to 447.
Pre-foreclosure inventory, or homes with a notice of default, stood at 21,340 in December, including 10,009 real estate-owned, or bank-owned, homes.
Banks may be moving through the foreclosure process a little faster in Nevada now that default filings have slowed, O'Toole said. The foreclosure timeframe was 330 days in December, 13 days shorter than November.
"If you're a homeowner who wants to move on and repair your credit, that's a good thing," O'Toole said.
"If you want to stay in your home, it's bad. Just like these laws are a good thing or they can be a bad thing. It's not clear," he also said.
Contact reporter Hubble Smith at hsmith@reviewjournal.com or 702-383-0491.
| DEC. 2011 | NOV. 2011 | DEC. 2010 | |
| Notice of default | 923 | 1,049 | 5,277 |
| Notice of trustee sale | 3,140 | 2,689 | 6,089 |
| Cancellations | 1,083 | 1,526 | 1,299 |
| Back to bank (REO) | 925 | 1,310 | 1,639 |
| Sold to third party | 447 | 530 | 404 |
| Winning bid | $176,000 | $164,000 | $179,000 |
| REO inventory | 10,009 | 10,656 | 10,911 |
| Days to foreclose | 330 | 343 | 260 |
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Don't be fooled... it's not like all of a sudden everybody is paying their mortgages. Just more kicking the can down the road...
All it means is that it's going to take a lot longer to clear out all of the bad loans and have a truly sustainable housing recovery take place in Las Vegas...
Florida and California passed similar laws back in early 2011 that slowed down the foreclosure process.... now their Foreclosure starts are going back up and their housing prices are dropping again.
Don't pay your mortgage and live rent free for 2+ years.... What a great country!!!
@Revestor- yes good for the people working in the RE industry. It's very hard to find a full-service RE agent at this time. Plus the Gov. gets the transfer tax revenues.
The sooner the houses are lived, the sooner the healing process begins. Is that hateful? I think not.
The great news is that there were a record number of Vegas home sales in 2011 - a total of 48,186.
This is a Disaster! SB 284 filled with lollipops and candy cane progressive dreams! Reality is this is death by a thousand cuts. This will not help the value of residential real estate. It's the greedy bankers fault give me a break! It began with the Community Reinvestment Act in 1992 under Clinton. In 2003 and 2004 Fannie Mae was doing deals with Country Wide to streamline low doc loans. This type of stupidity multiplied in 2005-2007 with Fannie and Freddie leading the way. Who's the real culprit? It our government, and who pay's in the end? We do! No No I should say those that actually pay taxes! Keep letting these stupid politicians bribe you with your own money!
I agree with Army Vet. I have been doing foreclosure inspections for three years now- total joke. Some people deserve a break- agreed. But most foreclosures are by spoiled Baby Boomers letting go of their over-leveraged house (seconds and thirds for TOYS, no money back in to the house) by the advise of their over-paid lawyers who gives the advise of, "Get rid of your most underwater asset and keep the rest". Totally stupid... like an RV is going to give your financial power. I do not want to be displaced at 65. First have to ask yourself why you would think a cookie cutter house on cheap land would be WORTH 400K in the first place!
Use your brains people.
This is good news for some but for the bank haters there`s additional good news, J P Morgan`s profits for the yr is down almost 30% from $27 bill to $19bil.l BofA is contemplating cutting back on the U.S. operations and they just had a big layoff . perhaps we`re heading into another recession, the dems and the bank haters should be ecstatic.
While it's easy to pass judgement on people losing thier homes and the lifestyle you think they led to get to that point, lets point out some facts....Highest unemployment in the nation....Ground zero for ARM loans.....Ground zero for speculation from 2003-2006.....Throw all those variables in the mix and you have a recipe for what happened to our housing market, DISASTER....Blaming anyone one person or entity is shortsided, get over it, it happened.....How do we get through it or fix it is the million dollar question...Has AB284 helped or hurt the market? Depends on which side of the fence you're on....Are we on a slippery slope if we let investors buy everything up and rent them to us for a indefinate period of time? Maybe....Is the family who has lost household income due to our local economy thankful for this law and the time they are getting to stay in their home? Yes, and we should not call them freeloaders and compare our life to others, you have no idea what their journey is all about.....I would submit that you didn't buy your home to make money on it, it's a home, a place where you and your family find refuge, not appreciation....the cash value is for the creeps in real estate to figure out...real value in your home is how it complements your lifestyle and the memories you create there.....but, if it makes you feel better to pass judgement and call people out on their shortcomings, by all means, post your garbage and show how much hate is in your heart for your fellow man.
1stGradeTeacher - So you feel that the banks forced someone to buy a house and forced them to sign a loan? The SOMETHING that is wrong is that someone bought a house that they could not afford. But you are right, we are not hold the person accountable who took the loan out to buy a house. As far as the paperwork, you can thank Government for what we have to wade through to sign. Quite a bit of that paperwork is due to Government regulations that are designed to "protect" us and do nothing more than confuse us. What we have is people who bought a house, expecting it to continue to increase in value, and now that the house has lost value, doesn't want to continue paying for a house that lost half its value. Yes, there were some that can't pay as they don't have a job, and those I can feel sorry for. But there are others who walked away from their responsibility to repay what they borrowed. Banks made loans in good faith to someone who wished to purchase a house, made the loans in accordance with Government lending standards, and now they are the bad guys? I think you are trying to simplify a very complex situation that was not unique to Nevada. If you want to blame someone, blame how the Government regulations that existed back then provided incentives for the banks to act as they did.
not to worry the banks are probly holding out for more obama money and then they will take your home anyway ...
There are still THOUSANDS of foreclosures each week right? And this has been happening for years. AND all those people are deadbeats? Doesn't follow. Millions of Nevadans. There are just too many people who have lost their homes for anyone to say that they all deserved it. Too many.
The banks committed fraud. The system has made it so difficult that unless you are a loan officer or a lawyer - the fine print that is an inch thick keeps people from advocating for themselves. SOMETHING is very very wrong with all of this. And the banks aren't interested in helping anyone keep their property because it's in their own financial best interest to hurt the community and the homeowner.
Millions of people in Nevada were caught is a trap - and it was a corporate business trap.
And nothing has changed. What is to prevent these businesses from doing this again? We have held NO ONE ACCOUNTABLE for these bad loans. Half of everyone in the valley got abused by this system and then the banks and corporations just walk off.
Things have got to change. This cannot happen again. REGULATION.