Foreclosure filings surge in judicial foreclosure states

Foreclosure activity nationwide continued to fall in April, though foreclosure-related filings in the 26 states where courts handle the process jumped, according to a report from foreclosure data aggregator RealtyTrac.

One in every 698 U.S. housing units, or a total of 188,780 properties, were subject to a foreclosure-related filing in April, such as a default notice, scheduled auction or bank repossession. That’s down 5 percent from March and 14 percent from April 2011, and the lowest monthly total since July 2007, RealtyTrac said.

Foreclosure-related filings were up 15 percent from a year ago in 26 judicial foreclosure states where courts handle filings. In the 24 nonjudicial foreclosure states and Washington, D.C., filings were down 29 percent from a year ago.

"Rising foreclosure activity in many state and local markets in April was masked at the national level by sizable decreases in hard-hit foreclosure states like California, Arizona and Nevada," said Brandon Moore, RealtyTrac’s CEO, in a statement.

"Those three states, and several other nonjudicial foreclosure states like them, more efficiently processed foreclosures last year, resulting in fewer catch-up foreclosures this year."

"In addition, more distressed loans are being diverted into short sales rather than becoming completed foreclosures," Moore said.

"Our preliminary first-quarter sales data shows that pre-foreclosure sales — typically short sales — are on pace to outnumber sales of bank-owned properties during the quarter in California, Arizona and 10 other states." 

   

The nation’s five biggest mortgage servicers — Ally Financial, Bank of America, Chase, Citigroup and Wells Fargo — have had a much higher ratio of pre-foreclosure sales to sales of bank-owned homes (REOs) in recent months, RealtyTrac said. The five are averaging less than 1.5 REOs for every pre-foreclosure sale, compared with more than 2.5 REO sales for every pre-foreclosure sale among other lenders and servicers, the report said.

On the heels of the government’s $25 billion settlement with the big five servicers over so-called "robo-signing" practices, some industry observers predicted a rise in short sales because the settlement allows loan servicers to receive credit when they approve sales that include forgiveness of a portion of underwater homeowners’ debt.

Overall foreclosure starts — properties receiving their first foreclosure filing, either a default notice or scheduled auction, depending on the state — declined 2 percent year over year in April to 97,665. Nevertheless, 27 states posted annual increases in foreclosure starts with several states posting triple- or double-digit jumps, including New Jersey (180 percent), Utah (179 percent), Indiana (49 percent), Pennsylvania (44 percent), Florida (43 percent), and Michigan (42 percent), the report said.

The number of properties repossessed by lenders fell on a yearly basis for the 18th straight month in April. REOs fell by 26 percent last month to 51,415. Nearly three-quarters of states, 37, and Washington, D.C., saw REO activity drop year over year, including Nevada (71 percent), Arizona (70 percent), Washington (67 percent), California (52 percent), Virginia (47 percent), and Maryland (47 percent).

Eleven of the nation’s 20 most populous metropolitan areas experienced a year-over-year rise in foreclosure activity in April. All 11 were in the South, Midwest or Northeast. Of the remaining nine metros that saw annual declines in activity, six were in the Western states of California, Arizona or Washington, the report said.

Foreclosure activity in 20 largest U.S. metros, April 2012:

MSA Name	April 2012 properties with foreclosure filings	1/every X housing units	Pct. chg. from March 2012	Pct. chg. from April 2011
Riverside-San Bernardino, Calif.	7,049	213	-10.8	-30
Miami	9,031	273	-9.2	38.4
Atlanta	7,271	298	-11.1	21.3
Phoenix	5,755	313	-22.6	-44.4
Tampa, Fla.	4,295	315	18.2	59
Chicago	11,840	321	-7.6	25.5
Detroit	5,201	363	3.9	-32.2**
San Diego	2,960	394	-6.1	-18.7
Los Angeles	10,906	412	-10.9	-28.3
San Francisco	3,391	514	-18.9	-33.7
Minneapolis	2,497	543	17.3	3.4
St. Louis	1,793	696	-0.3	28.5
Dallas	3,376	741	11.7	17.8
Houston	2,741	842	-0.7	-2.5
Boston	1,961	960	46.7	2.4
Philadelphia	2,444	996	-12	24.3
Seattle	1,172	1,249	-8.6	-54.3
Washington, D.C.	1,530	1,447	-7.9	-30.2
Baltimore	637	1,777	9.6	20.4
New York	2,812	2,677	-7.6	7.3

**Actual decrease may be not as big due to expiration of Aug. 2009 law requiring NODs (Notices of Default) to be filed.

Source: RealtyTrac

Nevada had the nation’s highest foreclosure activity rate in April with 1 in every 300 housing units receiving a foreclosure filing. Nonetheless, Nevada’s overall foreclosure activity fell 67 percent on an annual basis.

California, which posted the nation’s second-highest foreclosure activity rate in the nation, also saw a double-digit drop in activity last month, down 30 percent, with 1 in every 351 units receiving a filing.

By contrast, Florida, a judicial foreclosure state, saw its foreclosure activity rise 26 percent year over year with 1 in 364 units receiving a filing last month — the third-highest rate in the nation.

Arizona’s foreclosure activity rate ranked fourth nationally with 1 in 377 units receiving a filing — a 44 percent year-over-year drop. Georgia’s foreclosure activity was the fifth highest nationwide with 1 in 398 units receiving a filing — a 21 percent annual increase.

Top 10 states with the highest foreclosure rates

Area	Foreclosure rate (April 2012)
U.S.	1 in 698 housing units
Nevada	1 in 300
California	1 in 351
Florida	1 in 364
Arizona	1 in 377
Georgia	1 in 398
Illinois	1 in 418
Utah	1 in 419
Michigan	1 in 487
Ohio	1 in 525
Wisconsin	1 in 547

Source: RealtyTrac

Of the 20 metros with the highest foreclosure activity rates in the nation in April, half were in California, three were in Florida, two were in Illinois, and one each was in Nevada, Arizona, Georgia, Utah and Colorado.

Metro area	Foreclosure rate (April 2012)
Stockton, Calif.	1 in 213 housing units
Riverside-San Bernardino-Ontario, Calif.	1 in 213 units
Modesto, Calif.	1 in 213 units
Vallejo-Fairfield, Calif.	1 in 218 units
Visalia-Porterville, Calif.	1 in 241 units
Merced, Calif.	1 in 245 units
Las Vegas-Paradise, Nev.	1 in 249 units
Bakersfield, Calif.	1 in 256 units
Miami-Fort Lauderdale-Pompano Beach, Fla.	1 in 273 units
Sacramento–Arden-Arcade–Roseville, Calif.	1 in 277 units
Rockford, Ill.	1 in 295 units
Atlanta-Sandy Springs-Marietta, Ga.	1 in 298 units
Fresno, Calif.	1 in 299 units
Salt Lake City	1 in 309 units
Lakeland, Fla.	1 in 310 units
Phoenix-Mesa-Scottsdale, Ariz.	1 in 313 units
Tampa-St. Petersburg-Clearwater, Fla.	1 in 315 units
Chicago-Naperville-Joliet, Ill.-Ind.-Wis.	1 in 321 units
Greeley, Colo.	1 in 334 units
Oxnard-Thousand Oaks-Ventura, Calif.	1 in 338 units

Source: RealtyTrac

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