By Mike Colpitts
Pushed by bank moratoriums and improving mortgage modifications, notices of foreclosure declined modestly in October, but equaled almost the exact number reported a year earlier, according to RealtyTrac. Initial filings were made against 332,172 U.S. residential properties, a 4% drop from the prior month.
Full foreclosures (REOs) declined month-over month in 33 states and the District of Columbia. Lenders have foreclosed on an average of more than 91,000 properties each month this year, formally taking back 93,236 residences in October. The figure marked a decline of 9% from the record high in September, but was still 21% higher than a year ago.
Default notices, scheduled foreclosure auctions and bank repossessions were reported on one in every 389 households. “October marks the 20th consecutive month where over 300,000 U.S. homeowners received a foreclosure notice,” said RealtyTrac CEO James Saccacio. “The numbers probably would have been higher except for the fallout from the recent ‘robo-signing’ controversy, which is the most likely reason for the 9% monthly drop in REOs we saw from September to October.”
Mortgage modifications, however, also appear to be making progress as initial default notices declined 2% during the month, and 19% from a year ago. Bankers’ report 3.7 million home mortgages have been modified since the foreclosure crisis started. Some 100,575 U.S. properties were tagged with default notices in October, the ninth consecutive month they have declined.
Default notices declined in Michigan by 18% for the month. Nevada saw a drop of 17% and California, which has seen higher home sales in some areas of the state due to a special state tax credit for home buyers, was down 9%.
However, some of the hardest hit states still sustained higher default notices, including Florida, which was up 2%, Ohio, up 10 percent; and Illinois, where notices were 24% higher.
Nevada remains with the nation’s highest state foreclosure rate, with one in every 79 housing units receiving a foreclosure filing during the month. Foreclosure activity increased on a year-over-year basis for the second straight month in Florida, propelling the state to maintain the nation’s second highest state foreclosure rate for the third month in a row. The foreclosure crisis also rages on in Arizona, which ranked third for notices for the month, nearly 24% higher than a year ago.