Foreclosures in Colorado dropped in the first quarter, but the dip is at least partly due to a slowdown in filings by lenders, according to a state report.
New foreclosure filings in the state fell to 8,115 in the first quarter, down 27 percent from the first quarter of 2010.
The quarterly total was the lowest since the third quarter of 2008 and was down nearly 35 percent from 2009’s third quarter, when filings peaked at more than 12,000.
“Mortgage services and lenders continue to process foreclosures at an unusually slow rate, and although we expected foreclosure activity to drop in the first quarter, it fell more than expected,” said Ryan McMaken, a spokesman for the state Division of Housing. “That gives us hope for the future, but right now, foreclosure sales at auction aren’t going away.”
The report said the decline likely reflects “some true stability in Colorado housing markets” but added that the decline in new filings cannot be attributed to market conditions since lenders and servicers continue to proceed with “an unusually high degree of caution when processing foreclosures.”
That additional caution — and the resulting slowdown in foreclosures — follows last fall’s “robo-signing” controversy, when Bank of America, GMAC and other mortgage companies were accused of rapidly processing foreclosures without proper documentation. The companies briefly halted foreclosures and have slowed the process significantly since resuming them, according to industry observers.
The report says a degree of stability has returned to local real estate markets, but “more job creation is needed” before a significant drop-off in foreclosure activity is likely.
A number of Western Slope and mountain counties saw a rise in foreclosures. From the first quarter of 2010 to the same period this year, filings rose 26 percent in Garfield County, 37 percent in Alamosa County and 29 percent in Delta County.
“The Western Slope and the mountains in Colorado are still growth areas for foreclosures,” McMaken said.
Places such as Eagle, Garfield and Montrose counties are seeing both increasing foreclosure numbers and some of the higher foreclosure rates overall, he said.
Howard Pankratz: 303-954-1939 or hpankratz@denverpost.com
