From InsideRealEstateNews.com - Jan 25th, 2012
According to a report by the Colorado Division of Housing, public trustees in Colorado released a total of 235,749 deeds of trust during 2011, falling from 2010's total of 251,861. Typically, a release of a deed of trust occurs when a real estate loan is paid off whether through refinance, sale of property or because the owner has made the final payment on the loan. Release activity declines as refinance and home-sale activity falls.
"Real estate activity perked up a bit during the fourth quarter, which would reflect some very recent growth in employment and some mild increases in home prices." said Ryan McMaken, spokesman for the Colorado Division of Housing. "But overall, the fourth quarter's activity wasn't enough to keep 2011 from being another flat year."
Detailed within the report, the number of deeds of trust released during 2011 was the smallest annual release total reported since the state began keeping release records in 2000. Release activity peaked during 2003 when there were 733,373 releases reported in the counties surveyed. The unusually large number of loan payoffs from 2002 through 2005 reflects a period of declining mortgage rates and increasing new home construction that led to a swift rise in home purchase activity and refinancing. From 2003 to 2011, however, loan payoffs fell 67 percent.
"Ten years ago, even a small decline in the mortgage rate would have produced quite a bit of new refinance and sales activity," McMaken said. "But since 2008, tighter lending standards and a drop in the number of eligible buyers has prevented a sizable surge in new activity in spite of record-low rates."
A deed of trust is similar to a mortgage and is a lien on real property to secure payment of an indebtedness. The deed of trust contains a grant of the property to the public trustee for the benefit of the holder.
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