Published: Thursday, June 14, 2012, 6:00 AM
By Elliot Njus, The Oregonian
Foreclosure filings fell in the Portland area last month, but they jumped statewide as lenders worked overtime to get ahead of new foreclosure legislation taking effect in July.
According to numbers released today by RealtyTrac, a California-based foreclosure listings firm, Portland-area filings fell 1.18 percent in May compared with April. That’s 11 percent fewer filings than the same month a year earlier.
The biggest decline reported in the area was in Clark County, where foreclosure filings have been more than halved compared with a year ago.
But across Oregon, filings jumped 10.3 percent in May from a month earlier. That’s still 13.1 percent fewer than the same month a year earlier.
The month-over-month increase is likely a response to a foreclosure law taking effect in July, said Ally Leavitt, a spokeswoman for Eugene-based Gorilla Capital. The company buys and remodels foreclosed homes for resale.
The law adds new responsibilities for mortgage lenders, most notably the requirement to go to mediation with the borrower before foreclosing.
“We anticipated that when this bill was passed, that lenders would feel pressured to begin the foreclosure process earlier,” Leavitt said. “We expect all foreclosures to increase through the end of the year before stabilizing again.”
Nationwide, filings jumped 9 percent in May but remain 4 percent lower than a year earlier. That marks 20 consecutive months of year-over-year declines.
Foreclosure starts, however, increased on an annual basis for the first time in more than two years.
A growing share of those foreclosures starts are likely to end in short sales rather than repossession. In Oregon, short sales — an alternative to foreclosure in which the lender accepts a home’s sale price instead of the full balance of the mortgage — now make up 10 percent of all home sales.
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