The predictions of more foreclosures this year is beginning to resonate with the lenders, homeowners and realtors. In December 2012 alone, there were more than 163,000 new foreclosure filings made.
In 2010, foreclosures were at their peak with more than 2.9 million homes in new foreclosure filings.
In 2012 new foreclosure filings topped 1.84 million. Although the 2012 foreclosures were about 3% less than 2011, the amount of foreclosed homes already on the market topped 1.5 million.
Nationally, foreclosures rose in most of the judicial states. In Colorado the lenders can foreclose on deeds of trusts or mortgages in default using either a judicial or non-judicial foreclosure process, although Colorado is primarily a non-judicial foreclosure state.
The judicial process in Colorado for foreclosure necessitates filing a lawsuit to obtain a court order to foreclose and is used when no power of sale is present in the mortgage or deed of trust. The court, most commonly, will declare a foreclosure and the home auctioned off to the highest bidder.
The non-judicial process to foreclose in Colorado is employed when there is a power of sale clause in a mortgage or a deed of trust. If the clause exists, and the borrower is in default, the borrower pre-authorizes the sale of the property to pay off the loan and that power is given to the lender to sell the property.
Colorado is very unique in its foreclosure procedures due to the fact the governor appointed a “Public Trustee” for each county. The trustee must act as an impartial party when handling the power of sale foreclosure. The process is complicated and the borrower would be better served if represented by a foreclosure defense attorney.
Currently, the majority of states are backlogged with foreclosures. Florida leads the nation in the amount of foreclosures with 1 in every 32 homes in the foreclosure process. In December 2012, Colorado had a statewide average of 1 in every 801 homes receiving a foreclosure filing. The following counties had a higher number – averaging 1 in every 428 homes in foreclosure filings: El Paso, Adams, Weld, Mesa, Delta, Fremont, Elbert and Garfield.
Nationally, the inventory of foreclosed homes rose 9% during 2012 leading to predictions of a weakness in home prices during 2013. Lenders, adjusting to new laws, processes and settlements exonerating them will begin to process deferred and backlogged foreclosures this year adding to that inventory. Other predictions are an increase in bank repossessions the first half of 2013 and a jump in foreclosure filings the last half of 2013. These predictions translate into a high level of foreclosures, short sales and repossessions for the year ahead.
When the housing crisis will finally fully recover seems several years away.
Keith A. Gantenbein, Jr. is a Colorado foreclosure defense attorney located in Denver and servicing all of Colorado. His foreclosure defense practice includes foreclosure prevention, foreclosure assistance, loan modifications, short sales, and all other foreclosure defense legal assistance. He also handles bankruptcies, mortgage negotiations, lender liability, real estate, civil litigation, contracts and landlord/tenant. If you think you will be facing foreclosure, or are in the foreclosure process, or have had a wrongful foreclosure, contact Keith Gantenbein at (303) 618-2122 for a one-hour consultation where he will discuss your situation and go over all your options with you.