California Foreclosures About To Double

Just found out my California cousin Felix just bought his first house: congrats! Is it shaping up to be a buyer’s market as foreclosures are starting to make headlines again? Is Felix on to something here?

Tyler Durden is predicting “Two months from now, the foreclosure crisis will be top of the news once again catching everyone off guard because of the past six months ‘intervention’. Thanks Washington.”

California just experienced their highest NOD (Notice of Default) on record. Mr. Durden continues,

The headlines in the near future will read:Circa April 12th – “March Foreclosures Drop Sharply but Foreclosure Starts at Record Highs”

 

Circa May 12th- “April Foreclosures Surge 200% and Foreclosure Starts Remain at Record Highs”

CA foreclosure background – in mid-2008 the foreclosure wave was artificially held back as a result of the CA law SB1137 enacted in Sept 2008. This also kept NOD’s and NTS’s at much lower levels than the actual defaults that were occurring. Other bubble states and several banks/servicers also went on random moratoria and the foreclosure wave was held back for the past six months. But just like so many other intervention and moratoria in the past, the problem just comes out the other side even more violent than if they would have done nothing. Adding insult to injury, the GSE’s announced this week that they were coming off moratorium, which could increase foreclosures by 20-25% alone. [more]

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