Foreclosures Nosedive? How Statistics Lie
Many states are reporting a slowing of foreclosures in November and December, which on it’s face seems like good news.
According to RealtyTrac, the leading online marketplace for foreclosure properties, foreclosures were down an average of 7% nationwide in November. Some states, like heavy-hit Colorado, are showing even greater declines.
But experts warn this may not be a signal of a recovery.
In fact, it may simply reflect the increased willingness of banks to attempt to work out problem loans, and the result of some banks placing a moratorium on foreclosures until the end of the year. Jobless numbers are still very high, and these problem loans may show up as a bump in the number of foreclosures next quarter.
“Delinquencies on loans not yet in the foreclosure process jumped to nearly 7 percent in the third quarter, a record high, according to the Mortgage Bankers Association,Ã¢‚¬ says RealtyTrac CEO James J. Saccacio. “And more than half of the homeowners who received loan modifications to reduce monthly mortgage payments in the first half of 2008 are already delinquent on their loans again, according to the U.S. Office of Thrift Supervision. Many of these delinquencies could turn into foreclosures next year.Ã¢‚¬
Nevada foreclosure activity in November decreased nearly 4 percent from the previous month, but the state maintained the nationÃ¢‚¬„¢s No. 1 foreclosure rate, with one in every 76 housing units receiving a foreclosure filing during the month Ã¢‚¬” more than six times the national average. Foreclosure filings were reported on 13,962 Nevada properties, up 109 percent from November 2007.
Florida is close behind. With one in every 59 housing units receiving a foreclosure filing in November, Cape Coral-Fort Myers, Fla., posted the highest metropolitan foreclosure rate among the 230 metro areas tracked in the report. Two other Florida cities ranked among the top 10 in terms of foreclosure rate: Fort Lauderdale at No. 7, with one in every 117 housing units receiving a foreclosure filing; and Port Lucie-Fort Pierce at No. 8, with one in every 118 housing units receiving a foreclosure filing.
See a related feature, Do Rules Favor Pre-Foreclosure Buyers?
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