'Extend And Pretend' Policies Slow Foreclosure Activity, Analyst Says

Sales of foreclosed homes in Riverside County and throughout the state dropped by double digits last month, according to a real estate tracking firm.

Bay Area-based ForeclosureRadar.com's monthly "Foreclosure Report" shows a total 886 repossessed properties were sold countywide in November, compared to 1,019 in October, a roughly 15 percent decline.

The county's foreclosure sales were down 25 percent from a year ago, when 1,185 homes were auctioned off, figures showed.

In California, sales of distressed properties also sank 15 percent in November, and were down 30 percent compared to the same period in 2011.

ForeclosureRadar.com founder Sean O'Toole said the numbers were unsurprising given the state and federal bent toward giving delinquent mortgagers opportunities to retain their homes by seeking modifications to their loans and lowering monthly payments.

"The policies of 'extend and pretend' continue to slow foreclosure activity while ensuring foreclosures will play an important role in our economy for years to come," O'Toole said.

On Jan. 1, the California Homeowner Bill of Rights goes into effect. The law will require loan servicers to suspend any foreclosure proceeding during the time a mortgagor is seeking a loan modification to prevent his or her property from being repossessed, and homeowners will have the ability to sue and seek monetary damages from servicers who fail to follow all legally required steps in a foreclosure proceeding.