Foreclosures in the US Mostly Down to Pre-Housing Crisis Figures

According to RealtyTrac, foreclosures in the US are now at their lowest levels ever since the great housing mortgage meltdown. However, in US states that practice judicial foreclosure proceedings, the numbers seem to have increased.

In just the third quarter of this year there were about 531,576 properties that filed for foreclosure. This number is down by 11% compared from last year’s numbers. Just this September there was a 7% drop in filings as compared to Augusts’ numbers. This data is down 16% when compared from the same month in the previous year.

Housing Market Rebounding

The decline in foreclosure numbers all across the country is a sure sign that the housing recovery is underway. However, the issue is that not all parts of the country are moving at the same speed. There were some US states that reported an increase in foreclosure numbers due to the fact of the recent robosigning scandal that interrupted the foreclosure process in those states.

Resolution of Robosigning Shows more Accurate Figures

According to RealtyTrac, they have been eagerly awaiting a more accurate return of foreclosure numbers ever since the latter part of 2010. This is due to the fact that the robosigning scandal forced some US states to halt further foreclosure proceedings to give way to an internal investigation of the matter. Robosigning is the fraudulent practice of some mortgage lending companies as well as banks that were fast tracking foreclosures very quickly by forging signatures and falsifying information.

This created a backlog of foreclosures and even a decline in numbers creating a so-called artificial signs of recovery. Industry watchers have been intently watching for the return of real foreclosure figures once the case was settled.

In some US states, particularly those that practice judicial foreclosure proceedings, the numbers have increased tremendously. This is due to the fact that the processes here take longer than usual because the courts are involved and there must be hearings.

States with Best and Worst Declines

US states where foreclosure declines were most prominent include: Georgia, California, Arizona, Michigan, and Texas. Of the 24 US states that practice non-judicial proceedings, there were only four that showed an increase. This was partly due to recent changes in foreclosure laws that required a bigger requirement for banks to foreclosure a property.

On the other hand, New Jersey, which is a judicial foreclosure state, saw its foreclosure numbers increase by as much as four times. Meanwhile, Florida, one of the hardest hit by the sub-prime mess, is at number one nationwide with the most properties that defaulted. Its numbers are twice the national median for foreclosures. The state saw a 24% increase on a year-by-year basis. September saw those numbers worsen as it reported for the eleventh consecutive month high foreclosure numbers.

RealtyTrac further estimated that the average foreclosed property price rose by as much as 12% when compared to the previous month. The average price was pegged at $194,681. Moreover, listings for new properties also were down by 40% when compared to the previous month.

Looking Ahead

It is now being projected that the housing market is on its way to a more realistic recovery. The small gains in the industry are now being complemented by more homebuilder activity, increased demand, and low foreclosed property inventories.

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