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New Cases of California Bank Foreclosure Homes Fall in 4Q

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By : John Cutts    99 or more times read
The latest report on bank foreclosure homes filings in California revealed a 17.5 percent decline during the last quarter of 2010 as compared to 2009. Actual loss to lender repossession dropped by 30.6 percent.

Such data could only mean two things. First, there were fewer borrowers who lost their homes to foreclosure. Second, lenders are easing off when it comes to foreclosing, especially since regulators are scrutinizing their every move following allegations of procedural mistakes and complaints lenders are not really working with borrowers to avoid foreclosure.

For the last quarter of 2010, there were 69, 799 default notices filed at California county offices. Based on MDA DataQuick information system, the figure is 17.5 percent less from 4Q of 2009 and 16.2 percent fewer from the third quarter of 2010.

DataQuick is not sure of the slowly recovering economy is a huge factor for the decline of bank foreclosure homes filings or it is simply because there are fewer households who are suffering from financial distress. Of course, more California bank foreclosures, including Los Angeles foreclosures for sale, will enter the market if not for loan modification and short sale options.

With the growing concern for the large number of homes ending up as bank owned residential properties, mortgage assistance events and fairs have increasingly become popular. In a similar event held at the Los Angeles Sports Arena, it was observed that more lender are approving loan modification proposals, particularly those involving the risky mortgage, such as adjustable rate mortgages or ARMs.

These risky loans were actually approved without verification of the borrowers’ true financial conditions. Most of them could not really afford the loan, but agreed to take them out, especially after being enticed by offerings of interest-only payment, no down payment scheme and the popular ARM. Most of these subprime loans defaulted almost immediately, resulting to millions of bank foreclosure homes in the market and the eventual crash of the mortgage industry.
John Cutts has been educated in the finer points of the foreclosure market over 5 years.

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