As discussed in previous installments, a recent change to California state law inserted an extra 30-day waiting period at the beginning of the foreclosure process. Sure enough, mortgage defaults plummeted when the law went into effect. But a couple of months came and went without a commensurate rise — was something else at work?

Apparently not. Mortgage default notices, which represent the first official step in the foreclosure process, came back with a vengeance in December.

Trustee sale notices — the second step — rose only slightly, but the chart shows that they are a lagging indicator (as one would expect for a later stage in the foreclosure process).

December is just one data point, but that data point suggests that the government’s efforts to fight foreclosures haven’t had any sustainable effect as of yet.

— RICH TOSCANO

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