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Foreclosures have dropped to their lowest level in Sonoma County in six years, a decrease attributed to new state laws and other regulatory efforts aimed at keeping borrowers in their homes.

Banks seized 154 homes in foreclosure proceedings during the first quarter, down 42.8 percent from the previous quarter, according to a report Tuesday by San Diego information service DataQuick.

It was the lowest figure for the period since 94 homes were lost in foreclosure auctions in the first quarter of 2007, a time before housing prices took a historic plunge.

Foreclosures already had dropped significantly last year under unprecedented government efforts to offer refinancing, loan modifications and reductions in loan principal to troubled homeowners. But activity declined even farther when a package of new state laws, the Homeowners Bill of Rights, took effect Jan. 1.

"Default notices fell off a cliff in January, then edged up," said DataQuick President John Walsh.

The number of foreclosures still may pick up somewhat later this year, Walsh said, "if lenders need to play a lot of catch-up."

In the past five years, a total of nearly 10,000 local property owners have lost houses and condominiums to foreclosure.

Foreclosures peaked in Sonoma County in 2008, when 2,800 homes were taken back by banks or sold to third parties at auction. But foreclosures have been falling for four straight years, dropping sharply last year to slightly more than 1,200.

Statewide, more than 300,000 underwater or distressed homeowners received some type of assistance to stay in their homes, said Madeline Schnapp, director of economic research for ForeclosureRadar, a Truckee company that tracks foreclosure data. One result is that distressed properties no longer play as big a role in a state housing market that is relatively low on homes for sale.

"The reason you're seeing such a low inventory is that distressed properties have gone away very quickly, primarily due to government interventions," Schnapp said.

In February 2009, three out of every four home sales in the county involved financially distressed property. By last month that figure had fallen to less than three in 10.

In the past four years, the federal government has implemented a variety of plans to help homeowners refinance their mortgages or obtain loan modifications. As well, five of the nation's largest banks last year undertook nationwide efforts, including reductions of loan principals, as part of a $25 billion settlement brought by state attorneys general over alleged mortgage abuses.

Real estate agents who once specialized in selling bank-owned foreclosure properties said they have switched their business back to conventional sales.

The opportunity for reselling foreclosures is "about zero," said Doug Del Fava, an agent for Frank Howard Allen in Kenwood.

When he spoke Tuesday with two other agents, Del Fava learned that the three of them had a total of just two listings of foreclosure resales. A few years ago, together they would have had more than 50, he said.

No one is predicting a major increase in foreclosures this year. But some agreed with Schnapp that one result of all the government intervention is a "kind of funny recovery" in the housing market, with low inventories, big jumps in median sales prices and an abnormal number of cash buyers.

Doug Solwick, broker/owner of Advantage One Real Estate in Santa Rosa, said it's the kind of market that can drive both buyers and agents crazy.

"This isn't for the faint of heart, that's for sure," Solwick said.

Mortgage defaults, the first step in the foreclosure process, declined 72.2 percent in Sonoma County from a year earlier to 194 — the lowest since mid 2006.

Across the state, most of the loans going into default are still from 2005 to 2007 — likely the peak period of weak underwriting standards for mortgages.

In the first quarter, California foreclosures declined 55.1 percent from a year earlier to 13,591, and mortgage defaults decreased 67 percent to 18,567. It was the lowest number of foreclosures in six years.

Investors statewide purchased an estimated 47.6 percent of the properties taken to auction in the first quarter, according to DataQuick. A year earlier, the estimate was 33.7 percent.