Foreclosure filings increased in January, up 14 percent from a year earlier, according to a new report.
But many of the filings were actually repeat cases left over from law firms that were sued by state officials over allegations of inflated billings, the report noted.
“There has been a slow but persistent increase in new foreclosure filings in the seven front-range counties in Colorado,” said Greg Hagan, owner and broker at Re/Max Alliance.
The report by RealtyTrac showed foreclosures were down by 4 percent nationally compared with January 2014.
In all, filings in January up 166 percent from December. Much of that, though, is from lawsuits filed by the Colorado attorney general’s office against several law firms, including Aronowitz & Mecklenburg and The Castle Group, which were the state’s largest.
“It appears that a number of these new filings are in fact re-filings with new law firms who took over the business after the bad-actor law firms were eliminated,” Hagan said in a release. “Many of these new filings have been in foreclosure limbo for more than a year and are now coming to sale in 2015.”
Aronowitz & Mecklenburg agreed to sell the business — reports are it sold to a Texas-based law firm — and paid more than $12 million to settle various claims against it.
Castle, however, remains embroiled in a legal battle that could take years to finish.
Both law firms had been main counsel for federally backed mortgages from Fannie Mae and Freddie Mac until those agencies pulled back around the time the attorney general’s investigation concluded.
The firms were alleged to have inflated a variety of fees they charged and cornered parts of the foreclosure business with companies they owned or controlled.
David Migoya: 303-954-1506, dmigoya@denverpost.com or twitter.com/davidmigoya