Bank repossessions topped 100,000 for the first time in a single month, reaching 102,134 in September, RealtyTrac reports. In total, foreclosure filings – which include default notices, scheduled auctions and bank repossessions – were reported on 347,420 properties last month – a 3% increase from August.
‘Lenders foreclosed on a record number of properties in September and in the third quarter, taking a bite out of the backlog of distressed properties where the foreclosure process was delayed by foreclosure prevention efforts over the past 20 months," says James J. Saccacio, CEO of RealtyTrac
RealtyTrac expects the number of foreclosure filings to dip in the fourth quarter, given the numerous foreclosure freezes announced by servicers. The firm says that foreclosure activity in the judicial states most affected by paperwork-related delays made up 40% of all foreclosure activity in the third quarter and 36% of bank repossessions.
The degree of impact depends on how quickly servicers can resolve their documentation issues, Saccacio says.
‘[I]f the documentation issue cannot be quickly resolved and expands to more lenders we could see a chilling effect on the overall housing market as sales of pre-foreclosure and foreclosed properties, which account for nearly one-third of all sales, dry up and the shadow inventory of distressed properties grows – causing more uncertainty about home prices,’ he explains.