The latest figures from ForeclosureRadar show that the number of distressed filings in California, one of the worst hit states in the country, fell in August.
Notices of default in California, which is the first step in the foreclosure process, dropped from July to 36,396 filings, a monthly dip of 19.1% and a 14.2% decrease from August of last year.
In a report the firm says that the government’s Home Affordable Modification Programme which provides cap incentives to servicers for the modification of loans in default or on the verge of default, appears to be having a positive impact.
But Sean O’Toole, founder and CEO of ForeclosureRadar, said that the programme could be hiding the true picture.
‘In effect the HAMP postpones a large amount of filings,’ he said. If it fails, the market would need further government intervention or there would be a wave of new foreclosures, he warned.
But overall the outlook for recovery is still muted.
According to the latest analysis from Moody’s it will be at least another 10 years before residential property prices return to the peak levels of 2006.
Source Property Wire