Foreclosure
activity in much of the nation now appears to be accelerating downward,
dropping 7 percent in a single month according to RealtyTrac. Foreclosure filings nationwide - default notices,
scheduled auctions, and bank repossessions - numbered 150,864 or one in every
869 U.S. housing units in January compared to 162,511
in December. This was a 28.5 percent
decrease from January 2012.
Foreclosure starts were down 11
percent from December and 28 percent compared to a year earlier and at the
lowest level since June 2006. Bank
repossessions or REO dropped 5 percent from the previous month and were down 24
percent from January 2012 to the lowest level since February 2008.
While overall
activity was down in most states, the size of the national decline can be
traced to California where a new law caused a 39.5 percent decrease in filings
from December to January making it the first time since January 2007 that
California did not have the largest number of filings in the country. RealtyTrac Vice President Daren Blomquist
said the new legislation that became effective on January 1 profoundly altered
the U.S. foreclosure landscape. "Dubbed the Homeowners Bill of Rights, this
legislation extends many of the principles in the national mortgage settlement
- including a prohibition on so-called dual tracking and requiring a single
point of contact for borrowers facing foreclosure - to all mortgage servicers
operating in California. In addition the new law imposes fines of up to $7,500
per loan for filing of multiple unverified foreclosure documents. As a result,
the downward foreclosure trend in California accelerated into hyper speed in
January, decisively shifting the balance of power when it comes to the nation's
foreclosure activity.
Scheduled foreclosure auctions increased
from the previous month in 26 states and the District of Columbia, hitting
12-month or more highs in several key judicial foreclosure states, including
Florida, Illinois, Pennsylvania, and New Jersey, although foreclosure starts
were down on a year-over-year basis in Florida, Illinois and Pennsylvania.
There were some stunning increases
in filings in several states where servicers finally worked through requirement
of earlier legislation and resumed foreclosure starts or bank
repossessions. Arkansas had a 539
percent year-over-year increase in foreclosure starts and in Washington and
Nevada those filings increased 179 percent and 87 percent respectively.
Florida assumed California's former
first place position in numbers of foreclosures; activity increased on an
annual basis for the 11th time in the last 13 months, up 20 percent,
and January filings increased 12 percent from December. One in every 300 Florida housing units had a
foreclosure filing in January, more than twice the national average
It is hard to imagine that, after
leading the nation in the rate of filings for over four years there could be
any properties left on which to foreclose, but Nevada posted the nation's
second highest foreclosure rate in January.
Overall activity was down 43 percent from a year ago but foreclosure starts
were up 19 percent over December and 87 percent year-over-year to a 16-month
high.
A 32 percent month-over-month jump
in scheduled foreclosure auctions helped the Illinois foreclosure rate rise to
third highest among the states in January. One in every 375 Illinois housing
units had a foreclosure filing during the month.
In addition to California there were
33 states where there were double digit decreases in foreclosure activity since
January 2012 and six where the drop was greater than 50 percent. The largest decreases were in Massachusetts
(67.2 percent) Oregon, Delaware, and Hawaii (61 percent each).