John Rebchook is a former Rocky Mountain News reporter with more than 30 years of experience in writing and communications... It’s the top 10 list that Colorado never wanted to be on, but it can’t seem to get off.
Colorado was ranked No. 8 in the nation for its foreclosure rate in August, according to a report by Irvine, Calif.-based RealtyTrac.
Colorado showed a 17.93 percent increase in all foreclosure activity – from initial filings to REOs, or Real Estate Owned, when the bank takes over a property – from July, far out-pacing the national average of a mere 0.47 percent month-to-month increase, according to RealtryTrac.
And from August 2008 to last month, Colorado experienced a 30.69 percent increase, more than double the overall national increase of 17.97 percent, according to the company, which tracks and sells foreclosure data. But that was largely because of a change in a state law.
Only 10 states showed a bigger percentage increase than Colorado from July to August. However, on a year-over-year basis, Colorado was in the middle of the pack as far as a percentage increase. Twenty five states showed a bigger percentage increase from August 2008 to August 2009, the report shows.
Ryan McMaken, of the Colorado Division of Housing, notes that RealtyTrac reports 4,422 new foreclosure filings for Colorado in August, while the report he did for the division show about 3,200. McMaken surveyed the largest counties in Colorado.
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“Given that the counties we surveyed account for about 90 percent of all foreclosure activity, it is difficult to see how RealtyTrac reached a total of 4,422,” McMaken said.. “It is very unlikely that the rural counties experienced 1,000 foreclosures during the month of August.”
McMaken also notes that RealtyTrac reports 1,974 completed foreclosures, while his survey finds about 1,200 in the Denver-metro area in August
“Again, it is unlikely that the rural counties experienced over 700 completed foreclosures during August,” McMaken says.
The 39 percent year-over-year increase reported by RealtyTrac was from a technical increase because of a new state law, he notes.The increase ” should be interpreted as a true increase in default and foreclosure activity year-over-year,”McMaken says. “The large increase is due to HB 09-1402 which required a new a 30-day waiting period between a newly-created notice of default and the ordinary notice of election and demand,” or NED.
Since HB 1402 took effect on Aug. 1, McMaken says,attorneys for lenders realized that NEDs could not be filed until 30 days after the initial notice required by HB 1402 had been sent.This meant that an extremely small numbers of NEDs were sent out in August 2008, he notes.
“So, if we compare the August 2008 number to the August 2009 number, it will appear as if an unusually large increase has taken place,”McMaken explained. “However, the change is really due to last year’s August number being unusually low.”
Colorado had one foreclosure filing for every 329 households, close to the national average of one for every 329 households.
By comparison, Nevada, which remained No. 1 in the nation for foreclosure activity, had one filing for every 62 households.
Nationwide, the report showed there were 358,471 foreclosure filings, which includes default notices, scheduled auctions and bank repossessions.
“The August report demonstrates that there is still an ample supply of properties filling the foreclosure pipeline even while the outflow of bank-owned REO properties onto the resale market is being more carefully regulated,” said James J. Saccacio, chief executive officer of RealtyTrac. “After hitting a high for the year in July, REOs dropped 13 percent in August, but we also saw a record high number of properties either entering default or being scheduled for a public foreclosure for the first time.”
[...] Colorado ranked No. 8 in foreclosures: Colorado showed a 17.93 percent increase in all foreclosure activity â¿¿ from initial filings to REOs, or Real Estate Owned, when the bank takes over a property â¿¿ from July, far out-pacing the national average of a mere 0.47 percent month-to-month increase, according to RealtryTrac. Go to Article (Insiderealestatenews.com) [...]