There is certainly massive uncertainty about the validity of many aspects of the foreclosure process. States are enacting legislation to protect home owners, courts are holding lenders accountable for sloppy transactions and record keeping, and the foreclosure process itself has be revamped on many states. Despite all of this, foreclosure times actually decreased in three critical states last month. California, Arizona and Nevada all reported decreased foreclosure timelines in June 2011 despite uncertainty over MERS, bank processes and the general wisdom of adding to the shadow inventory in a fragile market. According to ForeclosureRadar, even though the month-over-month foreclosure duration decreased in these states, year-over-year numbers still are in keeping with the prolonging trend. In Nevada, for example, the average number of days it took to foreclosure this June was 319 versus 239 in June 2010. Sean O’Toole, CEO of ForeclosureRadar, called the decrease “statistically interesting” but said that he does not “see it as signaling an end to lenders looking to avoid losses they can’t afford by continuing the extend and pretend policies of the past.”
Nationally, foreclosure filings have fallen 32 percent in the second quarter of 2011 after falling 29 percent in the first half of the year. James Saccacio, CEO of RealtyTrac, recently projected that “One million foreclosure actions that should have taken place in 2011 will now happen in 2012 or perhaps even later.” He added that this will “only drag out the effect on the real estate market” and pointed to “an ominous shadow over the housing market” that he does not believe will dissipate until the foreclosure inventory is “whittled down to a manageable number.”
It is interesting in this market that some apparently good news is actually bad and some apparently bad news is good. These are interesting times and we all have had to change the manner in which we conduct business. I have made more changes to my short sale real estate investing in the past three months than I did in the prior three years.