California Loans News

As of last quarter in the Golden State, the number of filed mortgage notices of default (NOD) have apparently decreased compared with the previous quarter. According to the MDA DataQuick report, this is “the result of lenders’ evolving foreclosure policies, an uncertain legislative environment and an uptick in the number of mortgages being renegotiated.”

During the period from July to September, the number of NODs sent out was 111,689. This represents 10.3 percent decrease from the second quarter’s 124,562. However, this year’s third quarter data is higher by 18.5 percent than the same period of last year. At that timeframe, it was only 94,240. In addition, the NOD peak was recorded during the first quarter of this year at 135,431.

DataQuick president John Walsh said, “It may well be that lenders have intentionally slowed down the pace of formal foreclosure proceedings. If so, it’s not out of the goodness of their hearts. It’s because they’ve concluded that flooding the market with cheap foreclosures in this economic environment may not be in their best financial interest, trying to keep motivated, employed homeowners in their homes might be the most cost-efficient to stem losses.”

As for the third quarter’s default loans, these were found to have the median origination month during July 2006. The same timeframe applies for this year’s previous quarters. Walsh explained, “There’s a batch of truly nasty loans that were made in mid 2006. There’s another batch made in late 2006. These are worse than the mortgages before and after, and it’s taking a long time to process them.”

The loan originators of the above said loans were from Countrywide (7,583), Washington Mutual (5,416) and Wells Fargo (4,425), Bank of America (1,979) and World Savings (4,237). These lending institutions were also the most active lenders in the last two quarters of 2006.

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