Denver Foreclosure Rates Fall at Last!

Foreclosures are still being reported in record numbers across the country, with more to come, but recently released figures for Denver show a reversal of a 12 year trend. According to RealtyTrac, which compiles statistics nationwide, foreclosures are still increasing elsewhere in record numbers, but Denver's trend is heading down.

In 2008, 27,785 foreclosures were filed within the seven-county Denver area, an 11.8% drop from the 27,785 filed in 2007. Going by the raw numbers, 2007 and 2008 was the worst year for foreclosures in Denver history. There was an astounding rise of 41.5% in foreclosures from 2006 and 2007. Previous foreclosure rates, on the rise since the early 90's, were overshadowed by housing prosperity and populating growth.

Why are things looking up in Denver when other areas are not posting optimistic numbers? Lenders have put a freeze on foreclosures over the last couple months, which might account for some of the reversal. The idea was that homeowners would have time to work out modifications with lenders. If it becomes business as usual for lender foreclosure departments, foreclosure rates could rise again. Carol Snyder, trustee for the Adams County, theorizes that more affluent homeowners are foreclosure candidates these days. Recent attempts by lenders to forestall foreclosures so they can work out a plan with the homeowner have been more successful because this group of homeowners might have more alternatives available than the low income homeowners who previously swelled the ranks.

Some credit for dropping rates is due to the success of the Colorado Foreclosure HotLine, which has helped 9,000 homeowners avoid foreclosure since 2006. They have also taken 52,000 calls which certainly directed many others to alternatives to filing with the help of the hotline counselors. Some callers who did not pursue alternatives through the foreclosure Hotline may have even pursued shortsale options with their lenders.

Within the Denver area, Denver County itself showed the biggest drop in foreclosure filings. In 2008, there were 6,145 filings, a 25% drop from the 8,240 filed in 2007. Denver City Councilman Michael Hancock feels this is because many of the riskiest mortgage holders have now worked their way through the system. He doesn't anticipate disbanding his Foreclosure Task Force any time soon though. "Now," he says, "my biggest fear is that people that have safe fixed-rate loans and good credit may lose their home if they lose their jobs."

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Marianne Bandy

Information for Denver Colorado Home Buyers