Foreclosures Down Again for August
August Sales Point to a Market Recovery
Foreclosures fell for the 4th straight month in August according to recently released figures by the real estate data collection firm CoreLogic. The information is part of a number of recent positive indicators that show the slump in housing may be over or that at the very least that things have bottomed out.
At the end of August, 3.2% of all homes in the U.S. that have mortgages were in some stage of the foreclosure process. This comes to about 1.3 million homes. This is a drop of 7.1% from such figures found in August of 2011. Not all homes that are in the foreclosure process are lost by the owners. Some of them manage to become current on their loans. An even larger number are able to negotiate a short sale with their lenders.
Some 57,000 foreclosures were completed in August of 2012. The recent figures bring to a total the number of foreclosures that have been completed since the fiscal crises began in September of 2008 to 3.8 million. Anaad Nallatahambi, the president of CoreLogic, which issued the report indicates that the downward trend in foreclosures and their gradual clearing of distressed inventory were “important signals that the recovery in housing is gaining traction.”
Different Regions have Different Rates in Recovery
The CoreLogic report shows almost half (48.1%) of all foreclosures in the past year occurred in just 5 states. 377,000 foreclosures have been completed in the last 12 months. California leads the pack with 110,000, followed by Florida with 92,000, Michigan with 62,000, Texas with 58,000, and Georgia with 55,000.
The 5 states that saw the fewest number of foreclosures in the last 12 months ending in August 2012 were South Dakota with 25, the District of Columbia with 113, Hawaii with 435, North Dakota with 564, and Maine with 612.
The 5 states with the highest percentage of foreclosure inventory as a percentage of all homes with mortgages were Florida at 11%, New Jersey at 6.5%, New York at 5.2%, Illinois at 4.8%, and Nevada at 4.6%.
The five states with the lowest percentage of foreclosure inventory as a percentage of all homes with mortgages were Wyoming at .5%, Alaska at .8%, North Dakota at .8%, Nebraska at .9%, and South Dakota at 1.1%.
Methodology of Report Present Caveats
The CoreLogic report separates the data into judicial and non judicial foreclosure. In judicial foreclosure states, lenders have to present evidence to the courts that there has been delinquency in payments before a borrower may be moved into foreclosure. In non judicial foreclosure states, lenders may issue notices of default to borrowers directly without proceeding through the courts. This is an important distinction because the time line for foreclosures in judicial states ends up being considerably longer as a result.
Foreclosures are completed when a property is auctioned and results in the purchase of a home either by a third party or by the lender. If the lender purchases the home, it becomes part of their real estate owned inventory or REO.