Banks are slowing foreclosure rates yet again, and it isn’t because they are out of borrowers to foreclose on. With the settlement earlier this year, banks began to clear out their existing REO inventory, and they slowed foreclosures in the Southwest in order to modify mortgages to meet their requirements under the settlement (note the uptick in cancellations last month). Ideally, the banks would like to modify loans to keep borrowers in place and complete short sales for those who want to leave. They don’t want to resolve there legacy toxic loans by foreclosure. Unfortunately, borrowers are not cooperating....