A CNBC report states that nationwide foreclosures are increasing again following a year-long reprieve. A new report from RealtyTrac states that one in every 624 households in the U.S. received a foreclosure filing notice during January, indicating a three percent increase from the previous month. The previous year found foreclosure activity frozen in many U.S. states due to processing delays after the fraud was uncovered in 2010, also called “Robo-signing,” but the RealtyTrac CEO expects the pattern of increasing foreclosures to continue in upcoming months.
This increase is in large part due to the finalized mortgage and foreclosure settlement reached in early February between five of the country’s largest lenders and 49 state attorney generals. Following this settlement, foreclosure activity increased for the first time in 12 months and more bank repossessions and foreclosed properties will be heading to the re-sale market.
Bank repossession, which is the final stage of the foreclosure process, increased an estimated 30 percent year-over-year in several states. In addition, bank-owned and real estate owned (REO) activity hit a high in certain states, including Illinois with a 16-month high and Indiana with a 15-month high. Default notices, the first stage of foreclosure, spiked in judicial states (such as Connecticut and Pennsylvania) and non-judicial states (like Maryland), though they were flat nationally in January.
Despite an eight percent drop in foreclosure activity, Nevada still has the highest foreclosure rate with one in every 198 households receiving a filing. California’s foreclosure activity also dropped, specifically to a 50-month low, but still, has the second highest foreclosure rate in the U.S.; more than 51,000 borrowers received a foreclosure filing in January. RealtyTrac also reports that cities in the Golden State account for nine of the top ten metro foreclosure rates.
The CNBC report asserts that until banks work through the extensive backlog of foreclosures, prices for homes will not hit a firm bottom, and distressed property sales continue to lower the value of homes around them. This pushes borrowers into a “negative equity” position, meaning owners will owe more on their mortgages than their homes are currently valued. Foreclosures are, essentially, still standing in the way of recovery.
If you are a Tennessee homeowner facing foreclosure, the bankrupt attorneys in Tennessee with Massey & Associates, P.C. can help you through the complicated and difficult process. We have years of experience helping homeowners who may possibly lose their home either contest the foreclosure or avoid it altogether. Please don’t hesitate to call our skilled legal team for assistance at (423) 396-0720.
Gary Massey, Jr., is a well-known courtroom advocate practicing law in Chattanooga, Tennessee. Gary is a native of Tennessee who began practicing law in 1998. He graduated from Cumberland School of Law where he was ranked in the top 3% of his class and was an editor of the Cumberland Law Review.
