Bloomberg News

Foreclosure Filings Fall 34% as Lenders Extend Paperwork Review

October 13, 2011

Oct. 13 (Bloomberg) -- Foreclosure filings in the U.S. declined 34 percent in the third quarter from a year earlier as lenders reviewed paperwork related to delinquent loans and home seizures, according to RealtyTrac Inc.

A total of 610,337 properties received notices of default, auction or repossession, down from 930,437 a year earlier and up from 608,235 in the second quarter, the Irvine, California-based data seller said today in a report. One in every 213 U.S. households got a filing.

Banks slowed foreclosure actions a year ago after allegations of “robo-signing,” or pushing through unverified default documents, surfaced nationwide. The claims spurred a probe by state attorneys general and ongoing settlement talks with lenders. The delays have resulted in 12 straight months of year-over-year filing declines, with September down 38 percent.

“We’ve been on a giant play-pause button for a year, but a lot of thoroughness occurred once the problems were identified,” James J. Saccacio, RealtyTrac’s chief executive officer, said in a telephone interview. “We might begin to see things unclog.”

Default notices rose 14 percent from the second quarter to 195,878, a sign lenders may be speeding up the repossession process, Saccacio said. States with the biggest quarterly jumps in default filings included Massachusetts, up 65 percent; New Jersey, up 29 percent; Florida, up 24 percent; and California and Ohio, both up 21 percent, according to RealtyTrac.

Home Repossessions Decline

Lenders seized 196,530 properties in the third quarter, down 4 percent from the previous three months and 32 percent from a year earlier. On a quarterly basis, repossessions rose 62 percent in Massachusetts, 47 percent in Oregon, 42 percent in Georgia and 27 percent in Illinois.

Nevada had the nation’s highest per-household rate of foreclosure filings at one in 44, followed by California at one in 88 and Arizona at one in 93. Georgia, Florida, Utah, Michigan, Idaho, Illinois and Colorado rounded out the top 10.

California, the most populous state, had the most total filings at 153,051, or one of four in the U.S. Florida was second at 67,886 and Georgia third at 33,637. Illinois, Michigan, Arizona, Texas, Nevada, Ohio and Colorado also ranked in the top 10.

RealtyTrac sells default data from more than 2,200 counties representing 90 percent of the U.S. population.

--Editors: Daniel Taub, Kara Wetzel

To contact the reporter on this story: Dan Levy in San Francisco at dlevy13@bloomberg.net

To contact the editor responsible for this story: Kara Wetzel at kwetzel@bloomberg.net


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