JPMorgan Chase (JPM) and Wells Fargo (WFC) cut their foreclosure timelines by as much as 100 days for some of the worst mortgages handled in the third quarter, according to a report from Moody's Investors Service. Home loans can average more than one year moving from foreclosure referral to sale and that process stretched out even further when mortgage servicers came under investigation and began correcting mishandled documentation at county courthouses in 2010. Corrections are still being made. Servicers appear to making progress, however, as a settlement with federal agencies and some state attorneys general nears. "Although pending foreclosure volumes remain high for all product types, foreclosure sale timelines improved from the second quarter, as judicial states continued to work through their significant backlogs of foreclosed loans," Moody's said. Moody's tracked completed foreclosure sales in some of the most backlogged states in the country such as New York, Florida, Nevada, California, Illinois and Pennsylvania. Wells and Chase seem to have made the most progress in cutting back timelines. For subprime mortgages, Chase averaged 264 days from referral to foreclosure sale in the third quarter, a big reduction from 412 days averaged in the previous three months. It's also the shortest amount of time of any of the big-five servicers. Wells cut its subprime foreclosure timeline to 314 days in the third quarter from 454 days in the previous period. Comparatively, GMAC, the servicing and mortgage lending arm of Ally Financial (GJM) took an average 550 days to move a loan through foreclosure. Chase and Wells slashed timelines on Alt-A and jumbo products as well. Chase averaged 265 days to foreclose on Alt-A loans, down from 376 for those completed in the previous quarter. Wells took 304 days, down from 430. Previously, Wells took the longest of any servicer to foreclose on Alt-A mortgages. Now GMAC holds the spot at 376. But on jumbos, no one is quicker than Wells, which averaged 207 days to foreclose, down from 273. But Chase is making the biggest improvements. The bank took an average 258 days to foreclose on jumbo mortgages that finished the process in the third quarter, slashed from 340 in the previous period. "Servicers completed their robo-signing reviews and are no longer holding up foreclosure sales, which is clearing out their pipelines somewhat," Moody's said. "Chase and Wells decreased their foreclosure sale timelines significantly." Still, finishing the foreclosure process and unloading the REO property are two different things. While some servicers are making progress on the front end, inventories continue to grow as the time it takes to sell REO lengthens. The REO isn't necessarily on the market this long, as sometimes the property is held to keep home prices as stable as possible. Inventories are expected to need close monitoring for years to come. After foreclosure sale, Wells took an average 197 days to unload a property once supporting an Alt-A mortgages in the third quarter, up from 191 in the previous quarter. REOs once linked to subprime loans continue to take the longest to sell. For those liquidated in the third quarter, Ocwen Financial Corp. (OCN), the largest subprime servicer in the space, took an average 288 days to sell an REO after the foreclosure sale, up from 237 days on REO sold in the second quarter. Moody's said REO timelines will only grow longer in the months to come. "Our outlook is that REO timelines will lengthen dramatically over the next year, hampering servicer efforts to expedite their foreclosure procedures as they try to maximize return to investors," Moody's said. "Given the significant number of loans in foreclosure, an increase in REO volume is inevitable." Write to Jon Prior. Follow him on Twitter @JonAPrior.