Metro foreclosure notices at 4-year low

Foreclosure notices in metro Atlanta plunged to their lowest number in nearly four years in August, pushed down by some improvements in the economy and, some say, by a court ruling on documentation rules.

Notices plummeted from 9,317 in July to 6,426 this month — a drop of 31 percent, according to Equity Depot Foreclosure Report.

"It's the smallest total since 2008," said Barry Bramlett, chief executive of Kennesaw-based Equity Depot.

He said a July Georgia Court of Appeals ruling in Reese vs. Provident Funding is one reason for the drop.

The ruling said mortgage owners or their agents must be clearly identified in foreclosure documents and notices printed in newspapers, and that they must include contact information of those who can modify a loan, approve a short sale or provide other relief.

Bramlett said attorneys handling notices slowed down to make sure documents comply with the ruling.

"I know some were pulled from sales (on courthouse steps) last month because of that," Bramlett said.

Attorneys have told him that was happening again this month, he said.

Several large law firms representing mortgage owners declined to be interviewed or did not return phone calls.

But a spokesman for one bank with a strong regional presence, Wells Fargo, said the ruling did not change the way it is proceeding with foreclosures.

Hugh Rowden, a senior vice president, said other factors were behind August's slowing numbers, such as improving employment numbers.

"The vast majority of our customers who have had mortgage payment challenges were either unemployed or underemployed," Rowden said.

Georgia's unemployment rate last June was 9.3 percent, about a full point lower than the June 2011 rate.

The drop also reflects the national trend of foreclosures slowing because of other legal problems with documentation, and because lender and federal efforts to re-work loans for home owners is having some success, said Walter Molony, a spokesman for the National Association of Realtors.

Metro Atlanta foreclosure notices peaked at 13,834 in November of 2010, and there were a total of 127,140 sent out in the 13-county region that year. Some of those were repeats.

Notices fell to 109,548 last year, and this year's totals are running 9,700 behind where the 13-county region was last August.

Foreclosure notices do not necessarily end in repossessions; they are an initial legal step in the process. Lenders may fail to proceed or move quickly. Also, lenders can work with borrowers to find a settlement or write down loans.

Foreclosures have an immediate impact on the housing market. They usually sell at low prices, which drags down nearby home valuations and depresses government real-estate assessments. That means local governments get less property taxes to pay for police, fire protection, schools and services such as libraries.

Foreclosure notices drop

County July Aug.

Cherokee 503 281

Clayton 756 557

Cobb 1,089 715

DeKalb 1,494 1,067

Forsyth 266 182

Fulton 1,530 1,090

Gwinnett 1,904 1,285

source: Equity Depot