Even as foreclosure activity is slowing dramatically nationwide, it appears that judicial foreclosure states are revving up to clear backlogs which, in some cases, date back years. RealtyTrac, the Irvine, California firm which compiles foreclosure related data, reported today that foreclosure filings in June were 14 percent below May levels and down 35 percent from June 2012 to the lowest monthly level since December 2006. At the same time, judicial foreclosure auctions were up 34 percent from one year earlier. 

There were a total of 127,790 U.S. properties that received a foreclosure filing in June. This is one in every 164 housing units. The filings are of three types, notices of default/lis pendens, notice of sale, and REO/bank repossession.

Foreclosure starts dropped 21 percent from May and were down 45 percent from June 2012, the lowest level since December 2005. Bank repossessions (REO) in June decreased 9 percent from the previous month and were down 35 percent from a year ago.

The deceleration in foreclosure activity is even more apparent when the first half of 2013 is compared with the same period in 2012. From January to June 2013 there were a total of 801,359 foreclosure filings, a 23 percent decrease from the first half of 2012. Filings were also down 18 percent from the second half of 2012. So far this year foreclosure starts have totaled 409,491, a pace which would result in more than 800,000 for the year compared to 1.1 million foreclosure starts in 2012. A total of 248,538 bank repossessions have occurred nationwide thus far in 2013, on pace for nearly 500,000 for the year, which would be down from more than 671,000 in 2012.

"Halfway through 2013 it is becoming increasingly evident that while foreclosures are no longer a problem nationally they continue to be a thorn in the side of several state and local markets, particularly where a backlog of delayed distress has built up thanks to a lengthy foreclosure process," said Daren Blomquist, vice president at RealtyTrac. "The increases in judicial foreclosure auctions demonstrate that these delayed foreclosure cases are now being moved more quickly through to foreclosure completion. Given the rising home prices in most of these markets, it is an opportune time for lenders to dispose of these distressed properties, either at the foreclosure auction to a third-party buyer, or by repossessing the property at the auction and subsequently selling it as a bank-owned home.

 Judicial foreclosure auctions (NFS) were scheduled for 28,296 U.S. properties in June. States with substantial annual increases in scheduled judicial foreclosure auctions included New Jersey (up 103 percent), Florida (up 100 percent), Maryland (up 94 percent), New York (up 66 percent), and Illinois (up 65 percent to a 35-month high).

Florida, Nevada, Illinois, Ohio and Georgia posted the top five state foreclosure rates for the first half of the year, while five Florida cities posted the top five metro foreclosure rates: Miami, Orlando, Jacksonville, Ocala, and Tampa.

Foreclosures starts decreased from May to June in 38 states and there were big month-over-month decreases in in several. Nevada was down 84 percent, Colorado 62 percent, New Jersey 40 percent and Illinois 39 percent. Bank repossessions decreased on an annual basis in 34 states but were up substantially in Arkansas (+143 percent), Oklahoma (+103 percent), Maryland (+74 percent) and Washington (+71 percent.)

RealtyTrac said that, despite the uptick of activity in judicial foreclosure states, the foreclosure process continues to lengthen. Properties foreclosed in the second quarter of 2013 were in process for an average of 526 days, up 10 percent from 477 days in the first quarter. New York and New Jersey have the longest average timelines - 1,033 days in both states. Florida (907 days), Hawaii (824 days) and Illinois (817 days) also have protracted foreclosure backlogs.