Foreclosure Notices Still Spiking Around Seattle

It’s time once again to expand on our preview of foreclosure activity with a more detailed look at August’s stats in King, Snohomish, and Pierce counties. First up, the Notice of Trustee Sale summary:

August 2012
King: 1,056 NTS, up 36.1% YOY
Snohomish: 704 NTS, up 82.9% YOY
Pierce: 878 NTS, up 90.5% YOY

Up across the board, from up big to up huge. Of course we don’t know yet whether this is an actual increase in people falling behind on their mortgages or if it is just another weird artifact of the constantly-changing laws, regulations, and court rulings involving foreclosures.

Here’s your interactive Tableau dashboard updated with the latest foreclosure data:

The percentage of households in the chart above is determined using OFM population estimates and household sizes from the 2000 Census. King County came in at 1 NTS per 792 households, Snohomish County had 1 NTS per 392 households, and Pierce had 1 NTS for every 369 households (higher is better).

According to foreclosure tracking company RealtyTrac, Washington’s statewide foreclosure rate for August of one foreclosure for every 664 housing units was 11th highest among the 50 states and the District of Columbia. Note that RealtyTrac’s definition of “in foreclosure” is much broader than what we are using, and includes Notice of Default, Lis Pendens, Notice of Trustee Sale, and Real Estate Owned.

Hit the jump for a larger version of the chart that shows the percentage of households in each county receiving a foreclosure notice each month:

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, hit this chart and drag the date slider to its full range. 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.

15 comments:

  1. 1

    FCs Worsening and Spiking Again Seattle

    This data tracking obviously attracts down-thumbs.

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  2. 2
    The Desponder says:

    Do you guys think the Fed’s recent decision to purchase mortgaged back securities as part of QE 3 (or 4, depending on how you count them) will effect the way lenders treat defaults and foreclosures? I imagine that the gov’t is willing to buy MBS could increase the number of mortgages issued like the good ol’ days of the bubble years, but to a lesser degree. Could MBS purchases also lead to banks selling bad loans to the gov’t? And, would that slow down or speed up foreclosures?

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  3. 3
    Jonness says:

    RE: The Desponder @ 2 – I’m not sure how it will affect defaults, but it should drive down the cost of mortgages while driving up the number issued. Interestingly, incomes have been crashing for four years and counting. This economy is plain whack.

    “New numbers that have just been released show that things are getting worse for American families. According to the U.S. Census Bureau, median household income declined to $50,054 in 2011. That is a 1.5 percent decline from the previous year, and median household income has now fallen for 4 years in a row. In fact, after adjusting for inflation median household income has not been this low since 1995. These new numbers once again confirm what so many of us have been talking about for so long – American families are steadily getting poorer. Incomes are going down and the cost of living just keeps going up. This dynamic is squeezing more Americans out of the middle class every single month. Others just keep going into more debt in an attempt to maintain their previous lifestyles.”

    http://world.hawaiinewsdaily.com/2012/09/things-are-getting-worse-median-household-income-has-fallen-4-years-in-a-row/

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  4. 4

    If would be nice to think that some of the surge is due to trustee’s making corrections to NTS as a result of the Bain v. MERS decision. I’ve only looked at a very small sample (less than 5 probably) but have not seen any evidence of that. One sale I saw was delayed one week, but that could have been for any reason. They seem to just be plugging ahead as if the case never came down.

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  5. 5
  6. 6
    Hugh Dominic says:

    My guess is the banks got the message that home prices in Seattle are now strong. So they want to sell them now.

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  7. 7
    HappyRenter says:

    Does the Fed hope that QE3 will rush people into buying a home?

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  8. 8
    Marc says:

    RE: Kary L. Krismer @ 4 – After seeing your comment about MERS and business as usual I went back and re-reviewed a note and deed of trust for a deal that just closed this week. Sure enough, MERS is still using the “solely as nominee for Lender and Lender’s successors and assigns” language. I guess they really don’t give a $#!@ what the Washington State Supreme Court has to say.

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  9. 9
    Blurtman says:

    RE: The Desponder @ 2 – ” Could MBS purchases also lead to banks selling bad loans to the gov’t? ” That’s the idea. Create crap securities, obtain fraudulent Triple A ratings, sell them to suckers, get huge bonuses. What, the same institutions that engaged in this fraud were left holding some of this crap when “the music stopped.” No problem. The Fed will pick up what Fannie and Freddie did not. Ain’t taxpayers dumb? Vote for Obama, or vote for Romney. Won’t change a thing. But you obey the law now, ya hear?

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  10. 10
    redmondjp says:

    By Blurtman @ 9:

    RE: The Desponder @ 2 – ” Could MBS purchases also lead to banks selling bad loans to the govâ��t? ” That’s the idea. Create crap securities, obtain fraudulent Triple A ratings, sell them to suckers, get huge bonuses. What, the same institutions that engaged in this fraud were left holding some of this crap when “the music stopped.” No problem. The Fed will pick up what Fannie and Freddie did not. Ain’t taxpayers dumb? Vote for Obama, or vote for Romney. Won’t change a thing. But you obey the law now, ya hear?

    You got it.

    Privatize the gains; nationalize the losses! That’s how the real money is made these days . . .

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  11. 11

    By Marc @ 8:

    RE: Kary L. Krismer @ 4 – After seeing your comment about MERS and business as usual I went back and re-reviewed a note and deed of trust for a deal that just closed this week. Sure enough, MERS is still using the “solely as nominee for Lender and Lender’s successors and assigns” language. I guess they really don’t give a $#!@ what the Washington State Supreme Court has to say.

    I could see a very good excuse for that if they were past the day for an owner to contest the sale. And maybe possibly an excuse if the NTS had already been filed. The real test will be what happens for the situation where the entire process was started after the Bain decision, if not earlier with NTS being filed after.

    It’s almost as if the decision being made is to proceed as usual and deal with those who object. That probably makes sense from the banks’ point of view, and perhaps even many owners’ points of view, but I’m somewhat surprised the title companies are going along with it.

    Maybe the problem is simply that the Bain decision is somewhat of a mess, and they’re waiting for the District Court to issue a decision which makes some sense?????

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  12. 12
    apartment boy says:

    The Federal Reserve Bank is privately owned.
    O/T but the FDIC is 100% funded by quarterly insurance premiums paid by member banks.
    Hate to ruin the party with an inconvenient truth…but their losses aren’t nationalized(shout-out to Al Bore).

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  13. 13

    RE: apartment boy @ 12 – Four years ago you could have said something similar about Fannie and Freddie.

    I suspect though that F&F were something you could have said that about stronger than the FDIC. For F&F there was just an implied suggestion that the federal government would stand behind their bonds, but for the FDIC I think it’s explicit.

    I’m not sure the funding source matters all that much.

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  14. 14

    Lo Ball Jones that was funny.
    Kary and Marc, have we heard anything from the title companies on this?

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  15. 15

    RE: Jill Schlicke @ 14 – I have not, but there’s no reason I would hear directly.

    I did have someone interested in bidding on a house being foreclosed, and they were going to be paying cash. I advised them to talk to a RE attorney prior to bidding on it because it was a MERS DOT. They opted to not bid, and apparently no one else did either because the bank bought the property back. Not sure if the bank wanted too much or if MERS taints the ability to get short term financing through the hard money lenders.

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