April Foreclosures Up 72% from 2008 in King County

Time for our April update on Foreclosure activity in King, Snohomish, and Pierce counties. First up, the Notice of Trustee Sale summary:

April 2009
King: 938 NTS, up 72% YOY
Snohomish: 483 NTS, up 90% YOY
Pierce: 652 NTS, up 48% YOY

Here’s a simple look at how April’s foreclosures compare to the same month last year in each of the three counties:

Notices of Trustee Sale

Next let’s look at the percentage of households that received a Notice of Trustee Sale (based on household data for each county from the American Community Survey, assuming linear household growth between surveys):

Households per Foreclosure

King County came in at 1 NTS per 836 households, Snohomish County had 1 NTS per 543 households, and Pierce had 1 NTS for every 455 households (higher is better).

According to foreclosure tracking company RealtyTrac, Washington’s statewide foreclosure rate of one foreclosure for every 817 households was 27th worst among the 50 states and the District of Columbia (down from 18th last month). This was also better than the national average of 374 households per foreclosure. Note that RealtyTrac’s definition of “in foreclosure” is much broader than what we are using.

Following are charts of King, Pierce, and Snohomish County foreclosures from January 2000 through April 2009, with uniform y-axis scales to provide easier comparison. Click below to continue…

Notices of Trustee Sale - King

The number of King County homes in foreclosure pulled back slightly from the highs set in March.

Notices of Trustee Sale - Snohomish

Snohomish County also experience a dip, although theirs was much smaller in magnitude.

Notices of Trustee Sale - Pierce

Pierce County’s dip was relatively small as well, and continued to see the smallest YOY rise.

Finally, here’s a bonus graph from the current issue of Sound Housing Quarterly. When you view foreclosure notices by quarter, the effect of last year’s holiday foreclosure moratorium becomes quite clear:

King / Snohomish / Pierce Foreclosures (by quarter)

Net effect on the rapidly increasing rate of local foreclosures: zero.

Coverage elsewhere:
Seattle P-I: April foreclosure filings up from ’08, down from March
Seattle Times / AP: Foreclosure action jumps in April

Note: The graphs above are derived from monthly Notice of Trustee Sale counts gathered at King, Snohomish, and Pierce County records. For a longer-term picture of King County foreclosures back to 1979, refer to the final chart in this post.

For the full legal definition of what a Notice of Trustee Sale is and how it fits into the foreclosure process, check out RCW 61.24.040. The short version is that it is the notice sent to delinquent borrowers that their home will be repossessed in 90 days.


About The Tim

Tim Ellis is the founder of Seattle Bubble. His background in engineering and computer / internet technology, a fondness of data-based analysis of problems, and an addiction to spreadsheets all influence his perspective on the Seattle-area real estate market.

77 comments:

  1. 1
    Kary L. Krismer says:

    As I mentioned in the open thread yesterday, completed sales seem to be down. 207 in April compared to 230 and 233 in January and February. I apparently haden’t counted March.

    Also, as sales rise, foreclosures become a smaller percentage of the total transactions. Apples and oranges because 233 doesn’t break out condos, but ignoring that foreclosures were roughly 25% of sales in January, but only less than 20% in April. (It wouldn’t be too hard to determine total NWMLS sales to get proper percentages–it’s just not worth the effort.)

  2. 2
    Acerun says:

    How do foreclosure sales impact the comps used for financing the purchase of a non foreclosure home?
    Are they excluded as comps?

  3. 3
    Kary L. Krismer says:

    RE: Acerun @ 2 – I just answered that in another thread. Foreclosures are not arms length transactions, they are forced sales and thus not counted. The pool of buyers for a foreclosure is much smaller due to financing issues, and there are greater risks in buying a foreclosure property, including notably difficulty (or impossibility) in getting title insurance.

    Even short sales and bank owned tend to get excluded from comps. I had a listing where there were three other sales of practically identical houses in the same neighborhood, and my listing appraised at something over $50,000 from the lowest price sale, and higher than all the three others. None were a normal sale–all were short sale, REO, etc.

  4. 4

    RE: Acerun @ 2
    Some of the homes that receive NTS notices will be sold as either short sale properties or lender owned (REO) property, and these can potentially be counted as comps and can be a factor, but….
    If an appraiser finds five houses as comps, all in the same area, similar size and vintage and style, and only one of them is a REO or short sale, and they have sold for respectively 400, 430,420, 440, and the REO at 300, the one that is much further in price than the others will be regarded as an outlier and not counted. But if a several of them are REOs or short sales they may be counted and could have an impact on the non foreclosures.

  5. 5

    RENTORS BEWARE

    I blogged briefly on a pending topic that rentors should do a credit check on any potential landlords before signing rental agreements. It may sound far fetched to some, but if the landlord goes through foreclosure, the tennants get evicted. It isn’t far fetched to imagine a lot of land lords over water in debt due to overly optimistic investments in real estate. I’d be horrified too if I was a tennant and I noticed a high vacany rate….this cash downturn and rent decreases could easily bankrupt bad investors.

    When the landlord asks you to sign a SSN document for credit check, simply hand them yours too. If you’re talking to an apartment manager, make sure you put the actual property owner’s name on your background check of them. If the landlord won’t sign [that’s suspicious right there], you shouldn’t either. Rent somewhere else where duel credit checks are agreeable, even a bit higher rent.

    Why wouldn’t a landlord want their credit checked too?

  6. 6
    Kary L. Krismer says:

    RE: softwarengineer @ 5 – I would think that would be more of a concern if you’re renting a house. Someone foreclosing on an apartment house if very unlikely to want to kick out all the tenants, even if they could. If you have a real sweetheart deal on rent you might lose that, but I doubt you’d be out on the street.

  7. 7
    Kary L. Krismer says:

    RE: Ira Sacharoff @ 4 – I’ve heard of some appraisers totally ignoring REO and short sale, but I suspect that’s dependent on how significant of percentage of sales those things are in an area. Once over a certain percentage and it would be difficult to ignore them.

  8. 8
    Acerun says:

    RE: softwarengineer @ 5

    We moved about three months ago and I thought about doing this.
    I did put language in the lease basically getting us out if the property went into foreclosure.
    I am guessing the bank might want us out first.
    Is there a way for the non residential RE industry person to find out if someone is behind on their mortgage?

  9. 9

    RE: Kary L. Krismer @ 7
    In most cases around here I think they are ignored, we agree here.
    If short sales/REOs start making up a greater percentage of the total sales, they can’t be ignored.

  10. 10
    sf_boomerang says:

    Sorry, am I misreading something? The headline says King County foreclosures are up 90%, but then the little blurb right under it says King county foreclosures are up 72%, and Snohomish is the one up 90%.

    Y’know, cuz 72% is no big deal ;-)

  11. 11
    Kary L. Krismer says:

    RE: Acerun @ 8 – The only way to know they’re behind is when a notice of trustee’s sale is recorded. That would give you at least 3 months notice, but it wouldn’t let you move immediately.

    BTW, missing from this entire thread (except the graphs perhaps) is the fact that notice of trustee’s sale notices are down from March.

  12. 12
    patient says:

    I briefly saw Tim Geithner on the news today, he mentioned a new gov. plan that will encourage ( or force? ) quicker short sales with larger sums forgiven by the lender. I’m not sure what the reason is but it definately have the potential to lower the amount of foreclosures going forward ( we did something! ). Sounds like a very good idea that can help a quicker correction to take place. Regarding the the final step in the foreclosure procedure it should be no surprise if it’s lower in April since many moratoriums were in place, it should be more of a surprise that it almost kept pace with earlier months.

  13. 13
    Kary L. Krismer says:

    RE: patient @ 12 – In the P-I thread, I attributed the lower number of completed sales to the moratorium, but I thought it ended prior to April. If so, you’d expect the number of notices to be much higher. Does anyone remember when the moratoriums ended?

    And yes, forcing faster answers on short sales would help. The governor had proposed legislation that would do that, but it didn’t pass.

  14. 14
    patient says:

    RE: Kary L. Krismer @ 13 – Not sure of the exact dates Kary. When it comes notices you would expect them to continue to grow as the economy contimue to worsen and prices fall, april is only one month though and a bit of see-sawing is probably to be expected as well.

    The more I think about it the more I like the idea of the bank taking the hit at the short sale instead of at the foreclosure. It’s like a cramdown without rewarding the “guilty” parties instead it rewards the people who likely did not particpate, the new buyer. Very nice.

  15. 15
    patient says:

    RE: patient @ 14 – Isn’t it also so that a short sale will not completely trash the credit score of the borrower and thereby allow them to quicker be back on their feet?

  16. 16
    Kary L. Krismer says:

    RE: patient @ 15 – I don’t know which is better currently, but note that it might change in the future. Also, things like that are also up to the individual creditor. Most don’t give people who go the Chapter 13 route any better treatment even though those people at least try to repay part of their debt.

    The bank would probably come out better on a short sale than a foreclosure or REO.

    As to the monthly filings, you’d expect a surge right after any moratorium ended.

  17. 17
    patient says:

    RE: Kary L. Krismer @ 16

    “As to the monthly filings, you’d expect a surge right after any moratorium ended.”

    What I understand the moratorium did not put any restrictions on filings, just the final step the actual foreclosure of the property.

  18. 18
    The Tim says:

    RE: sf_boomerang @ 10 – Aw, geez that was dumb of me. Thanks for pointing that out. Headline fixed.

  19. 19
    The Tim says:

    By Kary L. Krismer @ 11:

    BTW, missing from this entire thread (except the graphs perhaps) is the fact that notice of trustee’s sale notices are down from March.

    It didn’t seem worth mentioning to me, since MOM is pretty much always up, down, up, down, up, down…

    Just look at the sawtooth pattern in that second chart. A month-to-month drop is nothing special unless it happens consistently over at least 3-4 months.

  20. 20
    masaba says:

    RE: Kary L. Krismer @ 11

    Kary, do you really think that it matters that much that notice’s of trustee sales were slightly down from March?

    Look at the entire figure. MOM data is extremely ‘noisy.’ Therefore, if you really want to use MOM as your figure of merit, you should probably do some sort of smoothing (exponentially decaying weighted average, curve fitting, etc).

    Edit: Guess Tim beat me to this.

  21. 21
    Kary L. Krismer says:

    I think it’s worth mentioning because there has been so much other bad economic news, at abnormal levels, that you’d expect a more steady upward pattern right now than is typical.

  22. 22
    D. says:

    I found this forum topic at redfin on renting from craigslist quite helpful.

    http://forums.redfin.com/rf/board/message?board.id=Seattle&thread.id=6608

    We just rented a 2 bedroom house after looking at 10 places. I don’t think SoftwareEngineer’s advice is realistic. We wanted a nice home in a nice neighborhood, and there wasn’t really a lot of room for negotiation. One place we liked in Fremont, we waited on and had hoped to negotiate on. When we called back the place was taken. I can’t imagine that landlord agreeing to a credit check when they have other prospective tenants interested or agreeing to take a knock in rent which was some advice dispensed a couple weeks ago.

    However, I did lookup the house to make sure it wasn’t in foreclosure and we made sure to look at the landlords id to make sure it matched who the county records. At some point, I guess you have to just use your gut instinct.

  23. 23
    JJL says:

    Not looking at actual foreclosures (TD’s) in comparison on these charts is the same as trying to look at Pendings on the MLS.

    Actual Foreclosures (NTS)
    Oct=294
    Nov=230
    Dec=224
    Jan=230
    Feb=233
    Mar=203
    Apr=207

    Through May 14th:
    NOT=413
    TD=98

    ;)

  24. 24
    monkey says:

    Hi all, a little off topic here, I am currently own a home in Snohomish County and want to trade up. I am looking for a home in Bitter Lake (98133) area because my boy will be attended Kindergarten next year. I look at all the new houses that are in the 98133 area, it still cost over half a million. Should I jump in now or should I wait. Thank you.

  25. 25
    what goes up must come down says:

    Monkey no offense but you are moving because your son is going into kindergarten? No schools in Snohomish?

  26. 26
    Jillayne says:

    To answer a few questions from above:

    Appraisers must consider short sales and REO sales as comps if the house is comparable to the subject property. Realtors should be preparing home sellers on this as foreclosures continue to rise into the mid and upper price tiers.

    In terms of how a person’s credit score is effected by a short sale, foreclosure, or loan mod: If the homeowner has missed mortgage payments, those missed mortgage payments WILL effect their credit score. There is no set number of “points” a person’s score will drop. FICO has a great pie chart explaining the elements of a person’s credit score. For example, if a person is younger, say in their 20s and does not have much credit established, then a short sale and missed payments will effect that person’s score more than a person in 60 years old, with well-established good credit, then a short sale and missed payments will effect that peron’s score less compared with the 20 year old.

    http://www.myfico.com/CreditEducation/WhatsInYourScore.aspx

  27. 27

    MY ADVICE ISN’T SPURIOUS

    Read this Jan 2009 AP article from the Seattle Times in part:

    “…You’re paying your bills, but your landlord isn’t. And you’re the one holding the eviction notice.

    This is becoming an all-too familiar scenario for thousands of renters nationwide who have become the unintended victims of foreclosures.

    Banks are booting good tenants onto the streets with little to no notice after seizing a property from a delinquent owner, ignoring tenant leases….”

    The rest of the URL:

    http://seattletimes.nwsource.com/html/realestate/2008587014_rent04.html

    As far as missing the low rent homes because of rentor competition, asking for landlord credit checks…..perhaps your chances of eviction get higher the lower the rent?

    Same I hear with bank interest rates from financial professionals, the higher the CD rates, the more desparate the bank. Have all you bloggers been inundated with bank mail to start accounts for a free $50?…..believe me, there’s no free lunch.

  28. 28
    Jillayne says:

    JJL,

    Regarding the difference between notice of trustee sales (NTS) and trustee deeds (TD) there is traditionally a 90 day lag time between the time the NTS is recorded, and the trustee sale (also referred to as the foreclosure auction.)

    The low number of TDs in May means that we would want to compare that to the number of NTSs recorded in, say, February.

    The large number of sale postponments happening each week leads me to estimate that TDs will rise substantially six months from the beginning of when we started doing massive loan modifications, which was roughly April. (50% of loan mods are redefaulting at the six month mark.)

    Foreclosure moratoriums ended officially on March 31st.

  29. 29

    KARY YOU’RE WRONG

    My article above states in part:

    “…But 15 million renters, or about 40 percent of all renters, live in single-family homes, many of which are owned by mom-and-pop investor landlords. This is where the risk lies….”

    The big apartment buildings are much safer than SFHs.

  30. 30

    I APOLOGIZE KARY YOU DID GET IT RIGHT

    Houses are worse. Long Blogger reads are error prone…LOL

  31. 31
    jon says:

    RE: what goes up must come down @ 25 – I presume he means that he does not want to change school systems once his child has entered. Perfectly reasonable concern.

  32. 32
    Kary L. Krismer says:

    RE: softwarengineer @ 28 – I said you wouldn’t have to worry about it as much if you lived in an apartment house. How is that wrong?

    Nevermind–I just saw the subsequent post.

    Oh, and Jillayne, thanks for posting the info on the moratorium ending.

  33. 33
    Hector says:

    So right now we are not comparing a ‘normal’ sale against a SS or REO sale.

    So what do you comp a SS or REO against, other SS’s, normals, or against their original price?

    Say in a neighborhood that has a mixture of 7 SS’s and REO’s. Same builder, similair ages, etc. Logic says they would be assessed against each other, right? But is that what would/should happen?

  34. 34
    Jillayne says:

    Hector, each appraisal will be different. The appraiser has to search for comparable sales that are close to the subject property.

    In your neighborhood example, the appraiser would also look for all recent CLOSED sales, whether or not they are traditional, REO, or short sale.

  35. 35
    monkey says:

    RE: jon @ 30

    Yes, you are right. Thank you.

  36. 36
    Ray Pepper says:

    I will make this simple for everyone to understand……….

    No Mortgage Cramdown?

    Foreclosures will continue to rise up up up!
    Short sales will continue up up up!

    Everything else delays the inevitable…………

    Take your time and FIND YOUR GEM! I assure you there is no rush!

    (BTW sellers contemplating short sale?? You may want to get some EXPERT advice. For many of you I suggest you live in the home until the bitter end and save save save. I’m knee deep in short sale activity with clients and nearly all should have stayed in their home. Don’t move out!!!!!!! SAVE!!! Throw the pride aside. Life is far too important and YOU MUST EDUCATE YOURSELF!)

    You found the Bubble. Now dig a bit deeper!

  37. 37
    Kary L. Krismer says:

    RE: Hector @ 32 – I think you just need to negotiate the best deal you can, realizing that with a short sale you’ll have less competition. But what the bank will ultimately accept, be it a short sale or bank owned, will depend in the individual bank.

    For purposes of getting a loan on such a purchase, I’m pretty sure they’d use normal comps, unless perhaps the condition of the property was poor.

  38. 38
    asdlfkj says:

    Tim could you stop mentioning the YOY numbers without specifying what last months YOY numbers were. That’s all that really matters and the only thing that answers the question are we going down or up?

  39. 39
    Kary L. Krismer says:

    RE: Ray Pepper @ 35 – I would agree people in foreclosure should generally stay in their homes as long as possible. It amazes me how so many people move out months before they have to, effectively wasting thousands of dollars of free rent. Moving out too early doesn’t benefit anyone in most situations.

  40. 40
    JJL says:

    RE: Jillayne @ 27
    Jillayne, The numbers are just not supporting this theory (yet). If you factor in a 90 lag between filings and go back to last July with 730 filing, 90 days later you had 237 Trustee Sales.

    In January we had 916 filings, and 90 days later there were 207 Trustee Sales. This showed increased filings, yet a drop in actual foreclosures.

    Also, I don’t agree with using past loan modification default rates because those loan modifications did nothing to lower monthly payments, loan balances or interest rates. They gave the homebuyer no monthly debt relief. The Obama plan addressess all these issues and if loan modifications are done in a way to lower monthly payments, homebuyers will have a better chance of not going into re-default. SInce this new plan only went into effect on March 4th, we will probably have to wait at least a year before we see any results, good or bad.

    Also, I believe that the large amount of postponements are due to homeowners modifying their loans or selling their homes through short sales.

    So, I just continue to monitor the numbers to see if or when the spike in actual foreclosures start, so far the numbers remain flat.

  41. 41
    Ray Pepper says:

    OUCH…………Not Tacoma Dodge! I bought two cars there. Albeit they were both an Accord and a CRV!

    http://seattletimes.nwsource.com/html/localnews/2009219728_apwachryslerdealers.html

  42. 42
    S-Crow says:

    RE: Kary L. Krismer @ 3

    Kary,

    Who is the title company title officer telling you it is nearly impossible to get title insurance on a foreclosed property? Please clarify for readers here.

  43. 43
    ElPolloLoco says:

    RE: Ray Pepper @ 35

    You found the Bubble. Now dig a bit deeper!

    That you, Radzinsky?

  44. 44
    Kary L. Krismer says:

    RE: S-Crow @ 41 – I don’t remember what company I was dealing through at the time, but there was a house a neighbor was interested in bidding at a foreclosure sale, and our title rep indicated it would be impossible to get insurance on it. I think the policy that the trustee gets would only protect the trustee, and the one the lender gets (assuming they somehow finance the purchase) would only protect the lender.

  45. 45
    Jillayne says:

    JJL and all,

    I’m reading through the latest Geitner announcement regarding motivating servicers to move ahead and help people with short sales who can’t maintain their modified loan payment.

    There’s info in the P.R. regarding “deed in lieu of foreclosure.”

    It might be interesting to track how many DILs there are. These would show up separate from trustee deeds and may account for lower TD numbers.

  46. 46
    JJL says:

    Jillayne,

    I’ve actually been tracking Deeds in Lieu as well for both King and Sno. Co. There are very few in King Co. Most are in Snohomish Co and most of them are builders giving lots back to banks. I haven’t graphed them out as I didn’t keep an accurate count. I also read each deed. There may be one deed filed, but was for 20 lots from a builder held under one note. I’ve kept a list of the builder names and how many lots. For Sno. Co. I had 26 for April, 65 in March, and 23 in February. I would be happy to go back and extract them for you and add them to my graphs, if it would help in your classes.

    Julie

  47. 47
    One Eyed Man says:

    RE: Kary L. Krismer @ 43

    My knowledge of the title insurance industry is outdated, but this is my historic understanding of the issue regarding foreclosures. S-Crow, you can probably confirm some of this. In a normal sale, when escrow sends documents to be recorded the recording is commonly done by the title company pursuant to a standard set of instructions. Those instructions provide among other things that the title company is to record the documents and date down (check all recent recordings on the property) the preliminary commitment for title insurance to confirm that the policy will be issued subject only to the exceptions previously shown in the commitment. If this takes place as intended, the title company confirms to escrow that the documents were recorded and escrow proceeds to disburse funds.

    In a trustee’s sale, the trustee orders a Trustee’s Sale Guarantee. The Trustee’s Sale Guarantee just insures the trustee that the parties listed in the Guarantee are the parties who are shown of record as required to be sent the Notice of Foreclosure and Notice of Trustee’s Sale. That gives the trustee the ability to send out the notices to all parties who will be foreclosed out. There is no insurance for anyone else, including the buyer at the trustee’s sale. The buyer could get a preliminary commitment for title insurance if they wanted, but there is no ability for the buyer to get a timely date down of the commitment at the trustee’s sale and payment of the auction price to the trustee.

    If the buyer at the trustee’s sale has ordered a preliminary commitment for title insurance before the sale, I’m not sure how much, if any protection this actually affords. If a new encumbrance is recorded just before the sale, it presumably would be wiped out by the foreclosure, because it wasn’t recorded prior to the time the notices went out, but it could be messy. The buyer might have to bring a quiet title action to get rid of it. If there was a senior encumbrance or the trustee screwed up and didn’t send the notices to a junior encumbrancer that should have gotten them, that could be messy too. If the title insurer missed a senior encumbrance on the prelim and then tried to add it in as an exception after the sale when issing the policy, I don’t know if they are bound in any way by the prelim. Arguably, the party ordering the prelim agreed to pay at least the cancellation fee but I don’t know if the title co has a right to get out that’s spelled out in the commitment or if they could claim lack of consideration or something. Suffice it to say, there are a lot of messy questions as to how much value a preliminary commitment will give you if you buy at a trustee’s sale. There may be answers in the title commitment and the case law to some of these questions, but I’ve never fully researched them and never talked to anyone who gave me a reassuring answer I felt I could trust.

  48. 48
    Groundhogday says:

    From Zillow via Calculated Risk:

    20% of all homeowners said they would be at least “likely” to put their home on the market if there was a turnaround, 31% at least “somewhat likely.”

    Given that 6% of homes turnover annually on average, that is a fantastic amount of shadow inventory… and doesn’t even include the huge backlog of foreclosures. Don’t fire until you see the whites of their eyes, renters.

    http://zillow.mediaroom.com/index.php?s=159&item=124

  49. 49
    jon says:

    RE: Groundhogday @ 47 – But are those owners go to upsize, downsize, or simply relocate? It makes no sense that people would wait until they know the market has hit bottom so they can sell and start renting. The fact that they are waiting until maximum price compression suggests that most want to upsize.

  50. 50
    Vellebue renter says:

    Software Engineer,

    What’s all this have to do with Immigration?

    I have noticed it has been mentioned on this site that “redefining” things to make them not sound so bad…….so the stock market will go up in my opinion.

    -What is a “Pending Sale” now? Somebody who says they “want to buy it”?

    -Using the “Unemployment Rate” as opposed to the “Jobless rate” is a classic. Knowing full well many jobless have also run out of UI Benefits and dont count toward the UI Rate.

    Anybody else have some good examples?

  51. 51
    Bits_of_Real_Panther says:

    Very unscientific poll, to say the least. It could have been interesting if they had shown a comparison with another time period but in a vacuum it’s uninterpretable. In 2003 if you had asked people if they would be interested in selling a year later if their home was worth 20% more I’m sure a lot of folks would have said yes, and for non-flippers the goal would have been to upsize in most cases

  52. 52
    cheepseats says:

    RE: jon @ 48 – Wanting to upsize and being able to are different situations. It is interesting that 20% would want to sell if it turned around, but I am more interested in the “need to sell” people, if it stays flat or declines further.

    I think many people are going to realize that they can either make do with what they have or downsize…

  53. 53
    Ron says:

    The Way this Message/Blog Board is going…

    REAL ESTATE INDUSTRY Is about taken over this board… Real Estate, Mortgage what Part am I missing?

    3 Years ago you would of been hard pressed to see one even posting here.. Now it seems like the Real Estate industry people are approaching a good % of the comments here.. There still trying to swing the votes into the advantages of buying- why wouldn’t they though?

  54. 54
    Kary L. Krismer says:

    RE: One Eyed Man @ 47 – They indicated to me that they weren’t willing to issue a policy to a buyer. Now I did just check with one company, but the rep had worked with another company before and I’m fairly confident he would have told me if this company’s policies were different. And he didn’t just answer off the top of his head–he checked with someone.

    Now it is possible he was wrong, and I’d love to know if he was.

  55. 55
    One Eyed Man says:

    RE: Kary L. Krismer @ 54

    Unfortunately I don’t think I know the explanation.

    If memory serves me correctly, I think I’ve seen a title company try to put in an exception for the trustee’s sale in a prelim because they have no way of checking to be sure that the trustee gave all the proper notices but I’m not sure. The deed of trust act always provided that the trustee’s deed was final, but Im pretty sure the courts used to provide some equitable relief if a lien holder got missed. And I think the case law used to provide that the trustee could re-notice and redo the sale if a lien holder got missed, but that’s a little scary. I also seem to recall that when the statute was amended in the late 1990’s language was added to clarify the rights of the parties if someone doesn’t get all the notices.

    It might be worth it to check with someone who has an REO listing to see what, if anything, the title company put in the prelim concerning the foreclosure. A couple agents I know have an REO in escrow and I’ll give them a call to see if they can tell me anything.

    I’ve gotten a lenders policy before on raw lots where my client supplied the cash used to buy at the trustee’s sale, but that was 10 years ago. My client loaned the purchase money to bid at the trustee’s sale to a new LLC, which was related to the prior borrower. They issued my client a lender’s policy but as there is no escrow, it wasn’t issued until after the sale had been completed and my client had tendered the cash. We had gotten the prelim before the sale. And we had taken other property as additional collateral so we were fully secured by the other property and had a timely issued title policy on the other property.

  56. 56
    David Losh says:

    RE: Kary L. Krismer @ 54

    You can always get a title insurance policy as long as you give them money.

    The question is if they will pay a claim.

    Foreclosure is a messy business that some scammers are very good at. There again any idiot can over encumber a property. Some foreclosures also mask an unresolved property line dispute. Any number of things can come up after you take possession.

    So I have heard the same thing you were told, but also know that if you shop some one will take the payment for the policy. It’s a gamble for the company even in the best of situations.

  57. 57
    Andy says:

    This market is finished; people will now realize that real estate is a product of rents
    And its still too expensive to buy the crap out there –
    DOWN WE GO!!!!!

  58. 58
    Racket says:

    By Ron @ 53:

    The Way this Message/Blog Board is going…

    3 Years ago you would of been hard pressed to see one even posting here.. Now it seems like the Real Estate industry people are approaching a good % of the comments here.. There still trying to swing the votes into the advantages of buying- why wouldn’t they though?

    I wouldn’t say that. I actually love the fact that people with different interest post here. As they say the truth typically lies somewhere in the middle.

  59. 59
    David Losh says:

    RE: Ron @ 53

    In the blog world of Real Estate there is very little information, mostly hype. The most outrageous things get said on Real Estate sites to build organic search. It’s all very confusing with no real purpose other than to generate leads for Real Estate business.

    This forum is unique because it has discussion. It has real information from some of the most unlikely personalities.

    There is no business here. I doubt any one in the Real Estate business has any illusion about getting leads from the site. It’s that every one’s allowed to have an opinion.

    A second part about that is, in my opinion, there are many people who would like this site to continue and become profitable for Tim. It is a small business that has resisted the temptation to sell out for profit, which is admirable. For many in the Real Estate business this site is kind of what we would like to see in our industry, which is frank, open discussion, that some people refer to transparency.

    This site is attracting more professional people because it is open.

  60. 60
    Kary L. Krismer says:

    RE: David Losh @ 56 – Back in my attorney days I used to say title companies paid the claims they shouldn’t, and denied the claims that they should pay.

  61. 61
    One Eyed Man says:

    RE: David Losh @ 59RE: Racket @ 58

    I whole heartedly agree. Well said guys!

  62. 62
    Mark says:

    938 NTS/foreclosures in a month. To put that into perspective, that’s getting within range of the number of sales. It would seem a huge pent-up inventory is building up.

    We are headed for the down escalator folks. As soon as optimism/prices start to tick up this inventory will come out of hiding. Hold on for a bumpy ride.

  63. 63
    Kary L. Krismer says:

    RE: Mark @ 62 – But only 207 actual sales. So it’s only about 20% of normal sales, if you ignore condo sales.

  64. 64
    Groundhogday says:

    By jon @ 49:

    RE: Groundhogday @ 47 – But are those owners go to upsize, downsize, or simply relocate? It makes no sense that people would wait until they know the market has hit bottom so they can sell and start renting. The fact that they are waiting until maximum price compression suggests that most want to upsize.

    RE: jon @ 49

    I doubt very much that they are waiting for “maximum price compression.” Just about every seller I talk to is waiting for prices to return to bubble land, as if that was “normal” and what we are currently experiencing is a strange diversion from normal. Our town is loaded with accidental landlords, people who have already purchased a new home and can’t sell the old home.

  65. 65

    RE: Groundhogday @ 64

    SPEAKING OF RENTING

    Money magazine just came out and guess what? Seattle is the #1 city in America where renting makes far more sense than buying. They gave Seattle a $1000 rent for a $370K average unit…LOL

    You Seattle Bubble Brains renting really are Bubble Brains!

  66. 66
    BanteringBear says:

    While the 72% rate of increase YOY for King County NTS’s sounds significant, I think 1 NTS for every 836 households will prove to be quite paltry when compared to future rates. I would not be surprised to see an NTS for every 150 households when the carnage is at it’s worst. The Seattle area had one of the biggest bubbles in the entire country.

  67. 67
    Cheap South says:

    RE: Groundhogday @ 64

    …..and not too many can afford OR are willing to throw good money after bad, in a second mortgage.

  68. 68
    TheHulk says:

    RE: Cheap South @ 67

    Fool me once shame on you, fool me twice… (insert optional darwinian quote here)

  69. 69

    RE: Vellebue renter @ 50

    FUNNY YOU SHOULD ASK ABOUT FORECLOSURES’ RELATIONSHIP TO UNCONTROLLED POPULATION GROWTH

    All of you bloggers that know me, know I’m an old fashion environmentalist, like JFK and MLK. Of course, denial may make you happier; but let’s face it: pure honest scientific demography is what most scientist/engineering types like me adhere to anyway.

    See the proof:

    http://www.lasvegassun.com/news/2009/may/13/foreclosures-immigration-linked/

    have a great weekend!

  70. 70
    David Losh says:

    RE: softwarengineer @ 69

    I posted a comment you may have missed.

    There is an article about how people of Asian and Hispanic decent are leaving the country and are less likely to return or immigrate here in the near future. The point of the article was that at this rate the time line for whites becoming a minority in this country has been pushed back ten years.

  71. 71
    ElPolloLoco says:

    By David Losh @ 59:

    RE: Ron @ 53
    There is no business here. I doubt any one in the Real Estate business has any illusion about getting leads from the site. It’s that every one’s allowed to have an opinion..

    I disagree with that pretty strongly. When I’m ready to buy a house, if I make the determination that I need an RE agent, you can bet that I’ll call someone I’ve seen posting here.

    Better the devil I (think I) know than a devil picked at random from the phone book.

  72. 72

    RE: ElPolloLoco @ 71

    Devil here. I post here because I’m a freak and don’t fit in anywhere else. If that attracts clients I won’t complain, but my primary purpose for participating here is because I learn a great deal, and I feel like I’m amongst my peeps.

  73. 73
    One Eyed Man says:

    RE: Ira Sacharoff @ 72

    Ira Sacharoff, Prince of Darkness? OK, serving pork is bad, but it’s not that bad.;-)

  74. 74
    Softwarengineer says:

    HI DAVID

    You may have a point, based on average Seattle rush hour traffic decreases I’ve noticed the last year the following may be happenning:

    A mass exit of uncounted Seattle citizens out of the Seattle area

    A mass unemployed not driving to work anymore

    More taking the buses (LOL)

    I’m not the only one reporting this. Bus drivers I know tell me the same thing, as well as, other people who drive a lot for a living….just plain lots less cars out there [not always, especially with jammed lane road work or accidents] much of the time lately.

  75. 75
    Kary L. Krismer says:

    RE: Softwarengineer @ 74 – Undoubtedly unemployment is playing a part, but I also think it’s probably a hangover from $4.00 a gallon gasoline. That’s what started the decline in traffic, and between people having maintained their new habits and still trying to pay their way out of the debt they incurred from that, traffic would be expected to be still down. I really think $4.00 a gallon gasoline hurt the economy more than most people realize.

  76. 76
    Racket says:

    “I really think $4.00 a gallon gasoline hurt the economy more than most people realize. ”

    I agree 100% the price of everything went way up, and on some items never dropped back down.

  77. 77
    Racket says:

    “I’m not the only one reporting this. Bus drivers I know tell me the same thing, as well as, other people who drive a lot for a living….just plain lots less cars out there [not always, especially with jammed lane road work or accidents] much of the time lately. ”

    I wouldn’t completely agree with that. We have several employees that we track transit times for, and just like real estate it’s seasonal.

    This winter there was no major reduction in travel times.

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