The backlog of delayed judicial foreclosures continues to move through the pipeline as many properties are now being scheduled for public auctions after starting the foreclosure process within the last year.
Judicial foreclosure auctions were up on a monthly and yearly basis by 10% and 7%, respectively, as 30,023 were scheduled in October, RealtyTrac says. This is the 16thconsecutive month where scheduled judicial foreclosure auctions increased from a year ago.
“Lenders are likely moving these properties more rapidly to the public auction given that there is
The biggest annual increases in scheduled judicial foreclosure auctions were in Maryland (up 177%), Delaware (142%), New York (98%), New Jersey (97%), Pennsylvania (58%), Connecticut (35%) and Florida (32%).
Clearing this inventory from a lenders portfolio is what should be happening, according to Rick Sharga, executive vice president at Auction.com. But he is a little surprised the numbers did not start to increase earlier in the year and at a higher level.
“Lenders have been building a backlog of foreclosed properties since 2010 when robo-signing was uncovered, so any spike in activity will be big” Sharga said in an interview. “The good news is that new distressed loans are happening at historically low levels, so a lender is not experiencing a big increase in delinquent loans. It’s a matter of how quickly can they process the backlog of foreclosures they currently have.”
By the early part of 2016, Sharga believes most of the nation will have a normal housing market. However, the recovery can take longer in states like New York, New Jersey and Florida where the entire default foreclosure process takes nearly three years, he says.
“Even though most lenders in the New York and New Jersey area have resolved their
During October, foreclosure filings—default notices, scheduled auctions and bank repossessions—were reported on 133,919 U.S. properties, up 2% from September but down 28% from last year.
The five highest foreclosure rates were found in Florida, Nevada, Maryland, Ohio and Illinois, the Irvine, Calif.-based analytic firm revealed.
A total of 58,939 property owners started the foreclosure process in October. This is a 34% decrease year-over-year and represents the 15th straight month where starts have fallen on an annual basis.
Conversely, foreclosure starts during October were up from the previous month in 22 states, including Colorado, Florida and Illinois.
REO activity continued to fall annually as banks repossessed 29% fewer properties during October. In October, 37,775 assets nationwide were taken back by financial institutions.
However, bank repossessions did increase from a year ago in 15 states, most notably in Oklahoma which was up 59%, Maryland had a 54% uptick, Virginia saw activity rise by 47%, and Ohio and state of Washington were both up 30%.
“Homeowners and homebuyers are now able to negotiate home sales together without a bank being involved,” said Rich Cosner, president of Prudential California Realty. “It’s the way real estate should be, and it’s nice to be back to a more normal real estate market again,”
