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California Foreclosure Starts Up 7%

California saw a nearly 7% increase in foreclosure starts in January compared to December, 2010, while notice of trustee sales dropped almost 14% from the prior month, the latest report from ForeclosureRadar.com shows.

The rise in notice of default filings reverses a four-month trend of declines. Year-over-year changes were much smaller, with defaults down 3.32% and notices of trustee sales down 1.38% from January, 2010.

There was a big increase in sales at foreclosure auctions in January: Properties that reverted to lenders went up 51.5%, and those purchased by investors rose 52.8%.

From Sean O’Toole, founder and CEO of ForeclosureRadar:
“January brought significant increases in foreclosure sales throughout our coverage area, returning volumes to pre robo-signing levels …While the increase is significant, we’ve seen larger surges after moratoriums or delays have played out in the past. For example in CA after the delays caused by Senate Bill 1137 we saw a surge in notice of default filings that far eclipsed any prior period. That is not the case here. Despite months of slow sales, we’ve simply returned to prior levels, which to me indicates banks remain reluctant to aggressively foreclose despite the time it takes to foreclose being at or near record levels, and large inventories of properties still scheduled for foreclosure sale.”

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