Foreclosures not as bad as reported

John Rebchook, Rocky Mountain News

Tuesday, March 6, 2007

There were 28,435 foreclosures filed in Colorado in 2006, according to a Colorado Division of Housing report released today.

That is a 31 percent increase from the 21,782 in 2005.

However, while a record in total foreclosures, the filings were 48 percent lower than the 54,747 foreclosures reported by RealtyTrac, a California company that tracks foreclosure nationally.

RealtyTrac, based in Irvine, Calif., said that Colorado had the nation’s highest foreclosure rate for most of 2006.

However, Kathi Williams, director of the state’s housing division, has long thought that RealtyTrac in some cases is triple counting foreclosures.

Colorado is the only state in the country that uses the Public Trustee system for tracking foreclosures, she said. The division, in response to a recommendation from the Colorado Blue Ribbon Panel on Housing and the Colorado Prevention Task Force, completed its own analysis using Public Trustee data.

"The Public Trustee data indicates that foreclosure numbers have been exaggerated by some organizations providing foreclosure data on the state," according to the report. "For example, Realtytrac has provided widely reported foreclosure data stating that in 2006, Colorado experienced 54,747 foreclosures and had a total foreclosure rate of 1 in 33 households. If this is the case, Colorado has experienced an 85% increase in foreclosures since 2005, and a large number of counties would be experiencing foreclosure rates worse than 1 in 33 households."

Also, not every home that enters the foreclosure process completes it.

"It is not unusual that 20 percent to 40 percent of foreclosure filings will not proceed all the way to foreclosure sale,"

according to the report. "This means that, depending on the county, only 60 percent to 80 percent of foreclosures opened actually proceed to final foreclosure."

The counties with the most foreclosure filings per household were Adams, Weld, Arapahoe, Denver, and Pueblo.

Adams and Weld counties topped the list with 1 in 32 and 1 in 37 households in foreclosure respectively.

In Denver County, 1 in 47 households are in foreclosure.

In the mountains and the Western Slope, foreclosure rates are much lower with Mesa County and Summit County reporting a foreclosure rate of 1 in 167 and 1 in 131 respectively. La Plata County reported a foreclosure rate of 1 in 382.

In the Denver metro area, foreclosure rates ranged from 1 in 32 in Adams County to 1 in 144 in Boulder County.

Boulder County reported far fewer foreclosures her household than any other metro county. Arapahoe County reported 1 in 43.

Statewide, there were approximately 1 in 58 households in foreclosure compared to 1 in 75 in 2005.

Throughout the Front Range, the foreclosure rate per household has worsened since 2003, the first year statewide Public Trustee data is available.