Fewer US homes repossessed by banks in 2012

Lenders took possession of fewer U.S. homes in 2012 than a year earlier, as the pace of new homes entering the path to foreclosure slowed and banks increasingly opted to allow troubled borrowers to sell their homes for less than what they owed on their mortgage.
Associated Press
Jan 17, 2013

 

All told, banks repossessed 671,251 homes last year, down nearly 17 percent from 804,423 the year before, according to data released Thursday by foreclosure listing firm RealtyTrac Inc.

The trend, along with an annual decline in overall foreclosure activity, suggests that the country's foreclosure woes are easing, at least on a national level.

But half the states experienced higher levels of foreclosure activity last year and many are expected to continue seeing increases this year, RealtyTrac said.

All told, foreclosure activity, defined as the number of homes that received at least one foreclosure-related filing, declined 3 percent last year. That translates to 1.8 million U.S. homes, and represents a drop of 36 percent from a peak of 2.9 million homes in 2010, the firm said.

Florida had the nation's highest foreclosure rate last year, with 3.1 percent of households, or one in 32, receiving a foreclosure-related filing during the year.

Generally, states such as Florida and New York, where the courts play a role in the foreclosure process, take longer to work through their cases than California, Utah and other so-called nonjudicial states with a more streamlined process.

The judicial states also have taken longer to work through a backlog of cases that built up in 2011 when foreclosure processing slowed as the mortgage industry addressed allegations that lenders had processed foreclosures without verifying documents.

As a result, foreclosure activity rose last year in 25 states, most of them states with a judicial foreclosure system, while it declined in 25 others, most of those being non-judicial foreclosure states, RealtyTrac said.

Among the states with the biggest increases were New Jersey, Florida and Illinois. States with the biggest annual decline in foreclosure activity included Nevada, Utah and Arizona.

Many of the states with a judicial foreclosure process, including Florida, Illinois, Ohio and Indiana, should be caught up with their foreclosure backlog halfway through this year, said Daren Blomquist, a vice president at RealtyTrac.

Other states, such as New York and New Jersey, where the foreclosure process can run an average nearly three years, will continue to play catch-up through most of 2013, he added.

Blomquist expects foreclosure activity will decline in non-judicial foreclosure states through the first half of the year. But laws passed last year in California, Oregon and Nevada aimed at making it more difficult for lenders to foreclose on homeowners may end up deferring foreclosures in those states until later in the year.

"That could mean that, although we are comfortably past the peak of the foreclosure problem nationally, 2013 is likely to be book-ended by two discrete jumps in foreclosure activity," Blomquist said.

While foreclosure activity declined last year, the inventory of homes in some stage of foreclosure or in banks' possession climbed 9 percent to 1.5 million homes, RealtyTrac said.

Florida accounted for the biggest share of foreclosure inventory last year, or 20 percent of the national total.

Blomquist forecasts that between 500,000 and 600,000 homes will end up being repossessed by banks nationally this year, noting that, historically, about half of all homes that enter the foreclosure process end up being taken back by lenders. Last year, 1.1 million homes got started on the path to foreclosure.

 

Comments

Minuteman

Because no money was being made by foreclosing on the number of homes that qualified for foreclosure. Less houses vacant also helped with overall home values in neighborhoods.

Fromthe419

I think the rate is declining because they got almost all of them already.

Contango

Bingo!

Kimo

Why do I see full pages of Sheriff sales in the Sandusky Register?
.

Centauri

@ Kimo,

http://www.realtytrac.com/home/

Sometimes the news media wants people to feel real good.

Contango

@ Kimo:

'Cause locally, the housing mrkt is still a mess.

From the article: "Many of the states with a judicial foreclosure process, including Florida, Illinois, Ohio and Indiana, should be caught up with their foreclosure backlog halfway through this year,"

Unassumer

Yup. Most foreclosures done. Some still in the works. We're all homeless, renting or living in a camper now.

Julie R.

If this was true then why are the employees in the Erie County Common Pleas Courts working on Saturdays? Isn't it because of all the foreclosures?

Dr. Information

The paperwork for a single foreclosure is a nightmare. Banks have rented storage space to store all the paperwork dealing with foreclosures because each case takes a lot of time. Why do you think the avg person can stay in their house for 2-3 years before the bank eventually kicks them out?

Julie R.

What I'm curious to know --- who is buying all these foreclosures? Stories I've heard some of these properties are going to sheriff sales two and three times and don't have anybody bidding on them. One might have to wonder why the realtors aren't buying them up.

Julie R.

Another thing I'm curious about ---- how does the court come up with the starting bid when property is sold through foreclosure? Is the starting bid based on the amount that is owed to the bank?

Julie R.

I also would be curious to know how the common pleas court comes up with a starting bid when property is being sold at a sheriff sale but NOT through foreclosure --- like my deceased mother and stepfather's Huron property. How did the court come up with a starting bid of $40 thousand dollars LESS than what the auditor's office had it appraised at for tax assessment when the property was owned scot-free and clear of a mortgage for almost 40 years and it sure didn't have any back taxes owing.

I also would be curious to know how the Huron appraiser also came up with an appraisal LOWER than the auditor's appraisal prior to the (scam) sheriff sale. It certainly could not have been because the house needed any improvements or anything. It already had all new replacement windows, a new remodeled kitchen with all new built-in expensive appliances, a new remodeled bath, etc. etc. about five or six years earlier all paid for with cash. It even had a fairly new roof and new siding replaced about 8 or 9 years earlier. I believe it even had a fairly new furnace.

I also would be curious to know why the appraiser or whoever (according to the auditor's online records) used low-appraised properties in the city of Sandusky and the city of Vermilion as "comparable sales" to the property that was situated in the city of Huron.