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California Foreclosure Filings Shrink for First Time in 2010

Foreclosure filings in California were down in April for the first time since the beginning of the year, ""ForeclosureRadar"":http://www.foreclosureradar.com reported Tuesday. Last month, the[IMAGE]

locally-based company tracked a total of 58,410 notices of default and foreclosure sale filings in the Golden State. Default notices fell 16.01 percent compared to March, while sale notices dropped 10.25 percent.

Despite the decline in filings, the firm's data shows that the inventory of properties in pre-foreclosure or scheduled for sale dipped only slightly â€" down 3.17 percent and 2.77 percent, respectively â€" evidence that the drop in filings was offset by an increase in the time it takes lenders to complete a foreclosure.

According to ForeclosureRadar, time-to-foreclose in California, which presents the timespan from the filing of the notice of default to the sale of the property at a trustee


sale, increased to 239 days in April. That's up 6.22 percent compared to March.

Foreclosure cancellations are still on the rise in the Golden State, up more than 32 percent from the beginning of the year. While many averted foreclosures may be the result of servicers' efforts to modify loans and an increase in short sales, ForeclosureRadar says that's not the only explanation.

""The steady rise in cancellations leads us to believe that loan modifications and short sales are gaining traction"" said 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.""

O'Toole says that in fact, 14.6 percent of new notice of trustee filings in April were on previously cancelled foreclosures.

The number of foreclosed properties sold to third parties at auction in California also continues to climb, helped again last month by slightly better discounts. ForeclosureRadar reported that winning bids placed by third parties, on average, were 16.3 percent below market value and 42.7 percent below the loan amount.

According to ForeclosureRadar's market data, banks added 14,517 foreclosed California properties to their REO inventories during the month of April. The company puts the total REO supply in the state at 90,295 properties.

About Author: Carrie Bay

Carrie Bay is a freelance writer for DS News and its sister publication MReport. She served as online editor for DSNews.com from 2008 through 2011. Prior to joining DS News and the Five Star organization, she managed public relations, marketing, and media relations initiatives for several B2B companies in the financial services, technology, and telecommunications industries. She also wrote for retail and nonprofit organizations upon graduating from Texas A&M University with degrees in journalism and English.

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