Pace of Colorado Foreclosures Still Surging

by Peter Vernon on Foreclosures

The pace of Colorado foreclosures is still surging as the state moved up in the foreclosure rate charts in March and during the first three months of this year.

In January, Colorado was12th in the state foreclosure rate rankings. In February, the state moved up to 11th, and in March, it jumped up by two places to 9th in the rankings. First quarter rankings, it was tenth among states. Investors planning to purchase foreclosure homes for sale in Colorado will not be frustrated as there are more distressed properties to explore.

Residential market analysts in Colorado contended that the sharp increase in foreclosure actions in the first months of the current was due to the pursuit of foreclosures deferred last year by mortgage lenders.

Last year, mortgage banks and other lenders were pressured by government agencies and nonprofits to slow down on their foreclosure actions to give way to loan modification and other foreclosure prevention efforts.

In March, the pace of Colorado foreclosures stepped up by 21.3 percent from February filings and by 12 percent from March 2009 filings. Total March filings reached 6,252, including 2,141 units already in bank owned foreclosure listings and 4,100 units still in the trustee sale notification stage.

For the said three-month period, there were more than 16,000 units that were notified of delinquency, foreclosure and repossession, up by almost 9 percent from the previous quarter and up by more than 27 percent from the first quarter of 2009. Out of these filings, 10,671 units were notified of trustee sale and more than 5,300 units were taken back by the banks.

The pace of entry of distressed properties into real estate owned listings in Colorado also increased in the first three months of this year. The pace was good for investors looking for fixer upper houses, as owner-occupant buyers preferred foreclosures in move-in ready conditions.

There were only 600 repossessed units in January. In February, the REO number shot up by a stunning 186.5 percent to 1,719 units, and in March, REOs spiked by 24.55 percent to 2,141 units. Analysts contended that unemployment was a major factor in the failure of distressed homeowners to save their homes. Additionally, the federal mortgage modification scheme failed to help borrowers as income and home value requirements failed to pass program requirements.

All in all in the first quarter, the total number of Colorado foreclosures in bank owned listings reached 5,303 units, representing 33.1 percent of all filings during the quarter.

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