The national rate of foreclosure increased 2% in September, compared to August; however, foreclosures continue on a downward trend, overall, according to RealtyTrac's U.S. Foreclosure Market Report.
A total of 131,232 foreclosure filings – including default notices, scheduled auctions and bank repossessions – were reported on U.S. properties in September – a 27% decrease compared to September 2012.
This September marked the 36th consecutive month that the rate of foreclosure decreased on a year-over-year basis, the real estate data analytics firm reports. The downward trend began in October 2010, when lenders and servicers were accused of improperly signing off on foreclosure documents.
Foreclosures reached their lowest level since the second quarter of 2007.
For the third quarter, there were a total of 376,931 foreclosure filings – down 7% from the second quarter and down 29% from the third quarter of 2012 – representing one in every 348 housing units.
There were 174,366 foreclosure starts in the third quarter, down 13% from the previous quarter and down 39% from the third quarter of 2012.
States that saw the biggest drops in completed foreclosures included Colorado (down 71%), Arizona (down 63%), California (down 59%), Illinois (down 56%) and Florida (down 52%).
Bank repossessions (REO) decreased 24% in the third quarter, compared to the third quarter of 2012, but were up 7% from the previous quarter. A total of 119,485 properties were repossessed in the third quarter, putting the nation on pace for close to half-a-million total bank repossessions for the year.
States that saw increases in REOs in the third quarter included New York (up 65%), New Jersey (up 64%), Illinois (up 44%), Virginia (up 36%), Connecticut (up 34%), Indiana (up 30%), Nevada (up 29%) and California (up 19%).
‘The sharp jumps in foreclosure activity in some local markets may come as a surprise to some,’ says Daren Blomquist, vice president at RealtyTrac, in a statement. ‘These spikes in activity demonstrate that while millions of distressed homeowners have been pulled back from the precipice by foreclosure-prevention programs over the past several years, once those programs expire or are exhausted, a percentage of these troubled homeowners are still susceptible to falling into foreclosure. In addition, even slight economic downturns at the local or regional level can push these homeowners hanging on by a thread over the edge.’
In related news, a Bloomberg News report, citing RealtyTrac data, finds that foreclosure starts in the Washington, D.C., suburbs rose last month following federal budget cuts that may have made it harder for some homeowners to pay their mortgages.
Foreclosure filings climbed 144% in Fairfax County, Va., and more than doubled in Prince William, Loudoun and Fauquier counties, according to the article.
Meanwhile, foreclosure starts fell in the third quarter in 38 states.
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