In Orange County, California, foreclosures are taking longer and longer to process. It now takes lenders in Orange County 30 percent longer to complete a foreclosure, with the time necessary to process a sale or repossession stretched to over a year.
Recent studies have shown that foreclosures now take an average of 411 days to complete, from the filing of the first default notice to the final “trustee sale” or auction. In addition, Orange County lenders must actually wait a whole 90 days or more before they can file a default notice after a borrower ceases payment. This means that, in total, a foreclosure actually takes 501 days from the date that a borrower first defaults on his or her loan payments.
Overall Foreclosures on the Rise in Orange County
The recent study conducted by Foreclosure Radar also demonstrated an overall increase in Orange County foreclosures. Most notably, the number of bank-owned homes has actually increased by 12.8 percent since August 2010, and by an entire 1.1 percent just since July. In addition, notices of default – which officially starts the foreclosure process – increased by 12.9 percent since 2010 and 62.9 percent since July.
Demonstrative of the painfully long foreclosure period is the declining number of notices of trustee sale, which has been steadily falling despite increases in notices of default. Notices of trustee sale – which set a date for a foreclosure auction, thereby ending the process – fell 20.4 percent since August of 2010.
This unnecessarily extended foreclosure period means that more and more distressed properties are appearing in the Orange County housing market. As it takes so long to process a foreclosure, these properties are simply remaining in their distressed state, further damaging the rest of the surrounding market.