Buying A Downtown San Diego Condo: What is the Foreclosure Process

Since foreclosures require adherence to laws and regulations, it sometimes seems confusing to the average consumer.  The San Diego real estate market has been experiencing the impact of foreclosures and short sales.  We found a really easy chart that will show how many avenues can be used for a foreclosure.

Foreclosure Radar, a company that tracks foreclosures nationwide has summarized the overall foreclosure status and then down to California's foreclosures.

Nationwide Summary:

"Foreclosure filings and sales increase throughout most of our coverage are in August. Foreclosure starts jumped significantly, reversing what had been a declining trend over the past several months. Investors bought more properties on the courthouse steps in August than in July everywhere except in Washington. The number of properties Sold Back to Bank jumped significantly in Oregon, and also rose in California and Nevada. 

Foreclosure starts (the first notice filed, either a Notice of Default or Notice of Trustee Sale depending on the state) rose in every state. This appears to have been primarily driven by Bank of America and related entities, where we saw an overall 116 percent increase from July to August. Wells Fargo and US Bank also saw an increases in foreclosure start filings, while filings by JP Morgan Chase and Citibank were essentially flat. 

"Bank of America appears to be primarily responsible for the surge in foreclosure starts this month," says Sean O'Toole, Founder and CEO of ForeclosureRadar.com. "Since their average time to foreclose has recently increased to more than a year, it is unclear that these foreclosure starts will lead to an increase in foreclosure sales anytime soon." 

California Summary:

Notice of Default filings increased 69.5 percent to the highest level in a year. Notice of Trustee Sale filings were up more moderately, rising 6.0 percent month-over-month, but down 23.6 percent year-over-year. Cancellations were nearly flat, up just 1.9 percent from July. Activity on the courthouse steps increased in August. Properties Sold Back to Bank (REO) increased 12.3 percent from the prior month. Properties Sold to 3rd Parties rose 9.9 percent month-over-month, and 10.8 percent year-over-year. Time to Foreclose increased to 333 days in August, which is 49 days longer than a year ago." 

We are seeing homes and condos that are bank owned in a variety of San Diego areas.  Some banks are trying to work with their borrowers and help expedite a short sale.  Other banks don't want to negotiate and just head for the foreclosure.

Today's San Diego real estate market is like taking a ride on the world's largest roller coaster.  Just when you think the ride is over, it starts again.  

This is a series of articles by Sharyn and Victoria Crown, San Diego real estate agents.