Foreclosure Radar a web site that tracks every California foreclosure reported on April 14, 2009 that March 2009 set a new record for filings of Notices of Default (NOD), the initial public filing in the foreclosure process.  

In March 2009, 54,268 NOD’s were filed in California.  This represents a 29% month over month increase and a 26% year over year increase.  These filings also rose 26% from its previous peak reached in April 2008.  

In March 2009 33,178 Notice of Trustee Sale (NOTS) filings were recorded.  This was an increase of 82% month over month and 20% year over year.   This figure was down 15% from it’s peak reached in July 2008.

During the same month, however 10,040 properties were auctioned representing a 41% month over month decrease and 37% year over year decrease.  The is the last step in the foreclosure process and should be considered a lagging indicator.

The dichotomy between the increased NOD and NOTS filings and decreased sheriff’s auctions is explained by delays in foreclosure proceedings caused by various government programs aimed to assist distressed property owners through additional notification requirements (i. e. CA SB 1137) and moratoriums (i. e. Fannie/Freddie) which expired at the end of March 2009.  Additionally many financial institutions may have postponed foreclosure proceedings pending Federal stabilization efforts such as TARP, Making Home Affordable Plan, and certain accounting changes, whereby lenders anticipated a market or Federal guarantees for troubled loans.

Some increase to foreclosure activity can thus be expected now that the legislative and administrative dust has settled.  It remains to be seen whether the mortgage modification or refinance programs included in President Obama’s Marking Home Affordable Plan will significantly effectuates a reduction in foreclosures.