Nevada foreclosure filings continue to drop under new law
Nevada’s foreclosure rate inched lower last month as banks scale back efforts to seize homes from delinquent borrowers.
One in every 731 housing units statewide had a foreclosure-related filing in July, down 1.5 percent from June and down 44 percent from July 2012, according to a new report from Irvine, Calif.-based research firm RealtyTrac.
Filings include default notices, scheduled auctions and bank repossessions.
Nevada had the seventh-highest foreclosure rate in the country last month. Florida was No. 1, followed by Maryland, Ohio, Connecticut, New Mexico and Illinois.
Nationally, one in every 1,001 housing units had a foreclosure filing in July, up 2.4 percent from June but down 32 percent from July 2012, RealtyTrac reported.
Nevada, the foreclosure capital of America for five straight years after the housing bubble burst, was helped last month by a small number of default notices, 375. That’s up from 249 in June but far below the 2,108 notices filed in May, according to RealtyTrac data.
Notices of default start the foreclosure process, and the plunge in filings came after Gov. Brian Sandoval signed a bill on June 1 that is actually supposed to make it easier for banks to repossess homes.
Assembly Bill 300 changed a key part of Nevada’s controversial “robosigning law.” Under that measure, which Sandoval signed in 2011, bank employees had to sign an affidavit saying they have personal knowledge of a home’s mortgage-document history before they foreclose.
The law took effect in October 2011, and afterward, Nevada’s foreclosure process practically ground to a halt. In September that year, 4,684 default notices were filed statewide; the next month, there were only 80.
AB300, meanwhile, took effect the day Sandoval signed it. Under that law, a bank’s affidavit does not have to be based on personal knowledge; instead, it can be based on a review of internal lending records and either title paperwork or filings with the local county recorder.
The law should make it easier for banks to foreclose, thereby increasing the supply of homes for sale and, among other things, give real estate agents more listings.
Default notices, however, plunged 88 percent in June from the month before.
When RealtyTrac reported that, Nevada Bankers Association CEO Bill Uffelman said lenders must rewrite their foreclosure policies to adapt to AB300, as that might explain the drop in filings.