Foreclosure Activity Down with Fewer Bank Repossessions But Foreclosure Starts Rise For 3rd Straight Month

Overall, foreclosure activity declined year-over-year and month-over-month, but foreclosure starts told a different story in July, according to RealtyTrac’s foreclosure market report.

Foreclosure filings, which include default notices, scheduled auctions, and bank repossessions, fell 3% month-over-month and decreased 10% from July 2011. In July, 191,925 U.S. properties received a foreclosure filing.
Foreclosure starts, which include default notices or scheduled foreclosure auctions, saw a 6% decrease from June but were up 6% from a year ago.
“U.S. foreclosure activity continued its uneven descent in July as the overall numbers declined on an annual basis for the 22nd straight month, but properties starting the foreclosure process increased on an annual basis for the third straight month,” said Daren Blomquist, Vice President of RealtyTrac, in a release. “Recent foreclosure activity patterns vary significantly from state to state, often hinging on the level of dysfunction that exists in each state’s foreclosure process.”
Twenty-seven out of 50 states saw their foreclosure starts rise, 16 of which were in judicial states and 11 in non-judicial states. In judicial states, lenders must receive court approval to proceed with a foreclosure.
The states with the largest year-over-year increases in foreclosure starts were Connecticut (201%), New Jersey (164%), Pennsylvania (139%), Indiana (83%), and Massachusetts (65%).
Fewer homes were lost to the foreclosure process in July, with lenders completing the foreclosure process on 53,654 U.S. properties. The figure is a 1% decrease from June and a 21% decrease from a year ago. The yearly decrease marks the 21st consecutive month of declines in bank repossessions. According to RealtyTrac, the yearly decrease was also the main reason for the overall decline in foreclosure activity.
Thirty-eight states and the District of Columbia saw a drop in REO activity with Washington seeing a 35% drop all of which are non-judicial states.

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