California foreclosure filings fall to lowest level since 2005

The foreclosure crisis is rapidly becoming a thing of the past.

The number of foreclosure filings on California homes fell to their lowest level in nearly nine years last quarter, according to a report released Friday.

Lenders in the third quarter filed 16,833 notices of default -- the first step in the state’s foreclosure process. That was the fewest since the fourth quarter of 2005 and down 17% from a year earlier, research firm CoreLogic DataQuick said.

Rising home prices in recent years have left fewer people in the position of owing more on their mortgages than their homes are worth. Now, if they get into trouble on their loan, it’s easier to sell the house and avoid the bank knocking on their door.

CoreLogic DataQuick analyst John Karevoll said foreclosures were still an issue in some of the hardest hit markets such as the Inland Empire.

But even there, the problem is receding.

In Riverside County, foreclosure filings fell 15% from a year earlier, while in San Bernardino they plunged 23%.

In Los Angeles and Orange counties, filings dropped 12% and 10%, respectively.

“This home repo pipeline isn’t exactly drying up, but it sure is diminishing,” Karevoll said.

Following me on Twitter: @khouriandrew