Thursday, November 18, 2010

Only 14 states have a smaller inventory of foreclosures than Colorado

The percentage of Colorado mortgage loans in foreclosure fell to 2.4 percent during the third quarter of 2010, falling from 2009’s third-quarter rate of 2.78 percent. According to a report released today by the Mortgage Bankers Association, the proportion of Colorado mortgage loans in foreclosure fell this year from the second quarter to the third quarter, falling from 2.69 percent to 2.4 percent.



Compared to the proportion of loans in foreclosure for all states, Colorado’s totals are lower than national percentages. Nationally, 4.39 percent of loans nationwide were in a state of foreclose during the third quarter of 2010. Year-over-year trends are down nationally with 2010’s third-quarter percentage being an increase from the third quarter of 2010 when the total percentage of loans in foreclosure was 4.47. Nationally, foreclosing loans also decreased from the second quarter to the third quarter this year with a fall from 4.57 percent to 4.39 percent.

Only 14 states reported a smaller percentage of loans in foreclosure than Colorado. North Dakota reported the smallest percentage of foreclosing mortgages with 0.95 percent. Alaska and South Dakota placed slightly behind North Dakota with 1.50 percent of loans in foreclosure in both states.

States reporting the highest percentages of loans in foreclosure included Nevada and Florida with percentages of 9.72 percent and 13.68 percent, respectively.

Short-term delinquencies dropped slightly in both Colorado and nationally from the third quarter of last year to the third quarter this year. In Colorado, 30-day delinquencies fell from 2.78 percent to 2.55 percent, year over year, while nationwide, they fell from 3.79 percent to 3.57 percent during the same period.

State of Colorado foreclosure data has shown declines in new foreclosure filings, year over year, with a drop of 15 percent from the third quarter of 2009 to the third quarter of this year. Foreclosure sales at action, on the other hand, showed a year over year increase of 18 percent during the same period. The fact that fewer properties are entering the process, according to the Colorado data, would seem to reinforce the MBA’s finding that overall foreclosure inventory is declining.

Nationwide, the percentage of loans in foreclosure during the third quarter has outpaced Colorado since 2008. Prior to 2008, Colorado reported a larger percentage of foreclosing loans than was the case nationally, but since 2008, the percentage of foreclosing loans has grown more nationally than in Colorado each year. From the third quarter of last year to the third quarter of this year, the foreclosure inventory shrank faster in Colorado than nationally.

Colorado has repeatedly fallen in state-by-state comparisons in recent years. In 2007, for example, Colorado was often found to be in the top 15 states for foreclosures. Colorado has since dropped to 36th place.

This has also been the case in 30-day delinquencies and in the total combined percentage of loans that are in foreclosure or are 90-days delinquent.

Prior to 2008, Colorado experienced a large amount of foreclosure and delinquency activity before the rest of the nation making it one of the top states in the nation for foreclosures. Since 2008, other states like Nevada, California and Florida have outpaced Colorado and have moved national percentages above Colorado’s.