California Legislation Responsible for Drop in Mortgage Defaults?

The legislation:

"California State Senate Bill 1137, which went into effect Sept. 8, imposes significant new requirements on lenders prior to filing for foreclosure - including the requirement that servicers contact homeowner borrowers to explore options for avoiding foreclosure on their primary residence at least 30 days before filing a notice of default." - (Housingwire)

The results:

"Recent legislation in California helped push notice of default filings, which indicate the start of the foreclosure process, down 61.8 percent in September, according to a recent report released earlier this week. ForeclosureRadar, which published monthly foreclosure data, found that only 16,352 notices of default were filed in September, down from 42,790 in August, and a decrease of 36.4 percent from a year earlier." - (Housingwire)

The bad news:

The bill did not directly impact foreclosure sales; however, the number of foreclosure sales in the state still fell by 12.4 percent. Despite the monthly drop, properties taken to sale at auction increased 163.2 percent from the prior year, to 23,409 sales, with a combined loan balance of $9.75 Billion. - (Housingwire)