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Massive Disparity In Foreclosures as Judicial States Surge

by devteam July 11th, 2013 | Share

Evenrnas foreclosure activity is slowing dramatically nationwide, itrnappears that judicial foreclosure states are revving up to clearrnbacklogs which, in some cases, date back years. RealtyTrac, thernIrvine, California firm which compiles foreclosure related data,rnreported today that foreclosure filings in June were 14 percent belowrnMay levels and down 35 percent from June 2012 to the lowest monthlyrnlevel since December 2006. At the same time, judicial foreclosurernauctions were up 34 percent from one year earlier. </p

Therernwere a total of 127,790 U.S. properties that received a foreclosurernfiling in June. This is one in every 164 housing units. The filingsrnare of three types, notices of default/lis pendens, notice of sale,rnand REO/bank repossession. </p

Foreclosurernstarts dropped 21 percent from May and were down 45 percent from Junern2012, the lowest level since December 2005. Bankrnrepossessions (REO) in June decreased 9 percent from the previousrnmonth and were down 35 percent from a year ago.</p

Therndeceleration in foreclosure activity is even more apparent when thernfirst half of 2013 is compared with the same period in 2012. FromrnJanuary to June 2013 there were a total of 801,359 foreclosurernfilings, a 23 percent decrease from the first half of 2012. Filingsrnwere also down 18 percent from the second half of 2012. So far thisrnyear foreclosure starts have totaled 409,491, a pace which wouldrnresult in more than 800,000 for the year compared to 1.1 millionrnforeclosure starts in 2012. A total of 248,538 bank repossessionsrnhave occurred nationwide thus far in 2013, on pace for nearly 500,000rnfor the year, which would be down from more than 671,000 in 2012.</p

“Halfwayrnthrough 2013 it is becoming increasingly evident that whilernforeclosures are no longer a problem nationally they continue to be arnthorn in the side of several state and local markets, particularlyrnwhere a backlog of delayed distress has built up thanks to a lengthyrnforeclosure process,” said Daren Blomquist, vice president atrnRealtyTrac. “The increases in judicial foreclosure auctionsrndemonstrate that these delayed foreclosure cases are now being movedrnmore quickly through to foreclosure completion. Given the rising homernprices in most of these markets, it is an opportune time for lendersrnto dispose of these distressed properties, either at the foreclosurernauction to a third-party buyer, or by repossessing the property atrnthe auction and subsequently selling it as a bank-owned home.</p

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 Judicialrnforeclosure auctions (NFS) were scheduled for 28,296 U.S. propertiesrnin June. States with substantial annual increases in scheduledrnjudicial foreclosure auctions included New Jersey (up 103 percent),rnFlorida (up 100 percent), Maryland (up 94 percent), New York (up 66rnpercent), and Illinois (up 65 percent to a 35-month high).</p

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Florida,rnNevada, Illinois, Ohio and Georgia posted the top five staternforeclosure rates for the first half of the year, while five Floridarncities posted the top five metro foreclosure rates: Miami, Orlando,rnJacksonville, Ocala, and Tampa.</p

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

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

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About the Author

devteam

Steven A Feinberg (@CPAsteve) of Appletree Business Services LLC, is a PASBA member accountant located in Londonderry, New Hampshire.

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