The number of California homes that entered the foreclosure process during the second quarter fell for the fifth straight quarter, to the lowest level since second-quarter 2007, research company MDA DataQuick reported today.

The company reported that 70,051 notices of default were filed at county recorder offices in California during the second quarter, down 13.6 percent from the first quarter and down 43.8 percent compared to second-quarter 2009.

Also, the share of resale, foreclosed homes sold in the state dropped to 36 percent in the second quarter, down from 49.9 percent in second-quarter 2009 and 42.5 percent in first-quarter 2010. NODs, which mark the formal entry of a home into the foreclosure process in California, peaked at 135,431 in first-quarter 2009.

The share of foreclosure resales ranged from 9.5 percent in the San Francisco area to 61.7 percent in the Imperial Valley area during the second quarter, DataQuick reported.

"Obviously, motivated sellers and accommodating lenders have played a part in bringing the default filings down, especially when it comes to short sales," said John Walsh, DataQuick president, in a statement. "Public policy has also been a factor. We also need to remember that prices have come up off bottom over the past year. If they continue to rise, fewer homeowners will find themselves underwater, which is a significant factor in letting a home go."

The lowest-cost ZIP codes in the state, which represent 25 percent of the housing stock, represented 40.1 percent of default activity in the second quarter. In the 92 California ZIP codes with a median sale price above $800,000, the number of homes foreclosed upon in the second quarter rose 33.6 percent since the first quarter and 65.7 percent from second-quarter 2009.

Even so, those ZIP codes featured a foreclosure rate of 1.2 foreclosures per 1,000 homes during the second quarter, compared to 5.6 foreclosures per 1,000 homes across all California ZIP codes. The rate was 9.9 foreclosures per 1,000 homes in ZIP codes featuring a median sale price below $200,000.

For homes foreclosed upon in the second quarter, the average foreclosure process lasted about 9.1 months, up from 7.5 months for homes that foreclosed during the first quarter and 6.4 months for homes that foreclosed in second-quarter 2009.

Mortgages were least likely to default in the San Francisco, Marin and San Mateo County areas during the second quarter, and were most likely to default in the Madera, Sutter and Merced County areas.

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