relationship of nods ant nots

[pencilneck]

deleted. another example of spectacularly bad analysis on my part.

[SK in CV]

We have been and will continue to be at or near the bottom for awhile. The bottom does not signal the beginning of a new boom. The bottom can and will last for years. There are still thousands of homes underwater to varying degrees. A 10% jump in home values isn’t going to erase that, so NOD’s and sales will continue.

[bearishgurl]

pencilneck, I refer to them as NOD and NOS.

Historically, CA NOS’s followed the NOD’s by 3-9 months, depending on if the loan was a portfolio loan, backed by FF (conv – secondary mkt) or a gov’t program loan such as VA/FHA, CalVet, CHFA.

Very, very few trustors were able to cure their NOD once an NOS was filed. A few used a BK filing to throw a monkey wrench into the works (temporarily).

In tracking CA defaults back in time on select properties (a tedious process), I think you will find that 90%+ were foreclosed on between 111 and 290 days after an NOD was filed. It has only been since 2007 (when the gov’t props began coming out in full force) that defaulted-upon lenders have begun to get lazy and sit on their hands while collecting payments from a name-your-acronym HXXX Federal program, incentivizing them to move slow and do nothing.

I’m still following a few select properties in my zip code which were defaulted upon in 2010 in which nothing since then has been filed.

Now that these squatter or former-squatter trustors are able to play the “modification qualification game” with their lender while squatting or possibly making reduced “modified” mtg payments, you will find many more NODs filed than NOSs. In some cases, you will find two or more NOSs filed on the same property, months or a year or more apart. Even though the latest one has a substantially higher payoff amt that the first one filed, these sales (auctions) are STILL postponed up to a dozen times.

In sum, the lenders themselves are running up their own tabs when they could have taken the property back years ago. Meanwhile, the squatting or short-paying (thru mod) trustor is getting a free or cheap ride so is doing nothing because their credit is shot, anyway, making it harder for them to find a rental.

I coined this phenomenon “lender malaise.”

This situation will continue to go on until the PTB cuts these lenders’ spigot off at which time they will all of a sudden remember the telephone number of their favorite trustee’s office.

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