U.S. Foreclosure Activity Increases 7 Percent in August but Overall Down from Last Year

RealtyTrac® recently released its U.S. Foreclosure Market Report™ for August 2014, which shows foreclosure filings—default notices, scheduled auctions and bank repossessions—were reported on 116,913 U.S. properties in August, an increase of 7 percent from the previous month but still down 9 percent from a year ago. The report also shows one in every 1,126 U.S. housing units with a foreclosure filing during the month.

A total of 51,192 U.S. properties were scheduled for foreclosure auction during the month, down 1 percent from the previous month but up 1 percent from a year ago—the first annual increase in scheduled foreclosure auctions following 44 consecutive months of annual decreases. Scheduled foreclosure auctions in judicial foreclosure states, where foreclosures are processed through the court system, increased 5 percent from a year ago.

“The August foreclosure numbers demonstrate that although the foreclosure crisis is well behind us, the messy business of cleaning up the distress lingering from the housing bust continues in many markets,” said Daren Blomquist, vice president at RealtyTrac. “The annual increase in foreclosure auctions—the first since the robo-signing controversy rocked the foreclosure industry back in late 2010—indicates mortgage servicers are finally adjusting to the new paradigms for proper foreclosure that have been implemented in many states, whether by legislation or litigation or both.”

Scheduled foreclosure auctions increased from a year ago in 24 states, including Colorado (up 160 percent), Oregon (up 117 percent), Connecticut (up 81 percent), New York (up 81 percent), Oklahoma (up 72 percent), New Jersey (up 71 percent), Illinois (up 25 percent), South Carolina (up 21 percent) and Maryland (up 17 percent).

Other high-level findings from the report:

  • More than 55,000 U.S. properties started the foreclosure process in August, up 12 percent from previous month and flat from year ago. It was the second consecutive month where U.S. foreclosure starts have increased on a month-over-month basis.
  • Foreclosure starts, which in some states are the scheduled foreclosure auctions, increased from a year ago in 19 states, including Oklahoma (up 147 percent), Indiana (up 136 percent), New Jersey (up 115 percent), Massachusetts (up 55 percent), Florida (up 24 percent) and Maryland (up 20 percent).
  • Lenders repossessed 26,343 U.S. properties via foreclosure (REO) in August, up 2 percent from the previous month but down 33 percent from a year ago. It was the 21st consecutive month where REO activity declined on a year-over-year basis nationally.

· REOs increased from a year ago in seven states, included Georgia (up 146 percent), Hawaii (up 42 percent), Oregon (up 20 percent), Pennsylvania (up 12 percent) and Connecticut (up 10 percent).

  • Six of the nation’s 20 largest metro areas posted year-over-year increases in foreclosure activity: Washington, D.C. (up 18 percent); New York (up 18 percent); Baltimore (up 12 percent); Atlanta (up 11 percent); Philadelphia (up 11 percent); and San Francisco (up 2 percent).
  • Among the nation’s 20 largest metros, those with the five highest foreclosure rates were Miami (one in every 359 housing units with a foreclosure filing); Tampa (one in every 407 housing units); Baltimore (one in every 514 housing units); Riverside-San Bernardino in Southern California (one in every 612 housing units); and Chicago (one in every 662 housing units).

Florida, Nevada, Maryland, New Jersey, Georgia post highest state foreclosure rates

A total of 6,468 Florida properties started the foreclosure process in August, a 74 percent jump from the previous month and up 24 percent from a year ago, the first year-over-year increase in foreclosure starts after 17 consecutive months of year-over-year decreases. The rise in foreclosure starts helped Florida post the nation’s highest state foreclosure rate for the 11th consecutive month. One in every 400 Florida housing units had a foreclosure filing in August, nearly three times the national average.

The Nevada foreclosure rate of one in every 524 housing units with a foreclosure filing ranked second highest among the states, up from a No. 3 ranking in the previous month thanks to a 36 percent month-over-month increase in foreclosure starts, bringing monthly foreclosure starts to the highest level since October 2013.

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