Foreclosure-related filings rose 4.6 percent from May to June, data aggregator RealtyTrac said today, and the 889,829 filings for the second quarter represented a 20 percent increase over the same quarter a year ago.

Unemployment-related foreclosures accounted for much of the increased activity, and the high number of borrowers who find themselves underwater — owing more on their mortgages than their homes are worth — represent a potentially significant future risk, said RealtyTrac Chief Executive Officer James Saccacio in a press release.

Looking back at the first six months of 2009, the states with the highest rate of foreclosure-related filings were Nevada (one filing for every 16 homes), Arizona (one in 30), Florida (one in 33), California (one in 34), Utah (one in 69), Georgia (one in 70), Michigan (one in 74), Illinois (one in 76), Idaho (one in 79) and Colorado (one in 80).

RealtyTrac monitors public records to track when homes are subjected to a notice of default, auction notice or bank repossession. Not all homes subjected to foreclosure-related filings will be taken back by lenders. Some homeowners who default on their loans or whose properties are scheduled for auction are able to refinance their loans or negotiate a loan modification or short sale.

ForeclosureRadar, a company that tracks foreclosures and auctions in California, said foreclosure sales in the state jumped 24.7 percent from May to June, the third consecutive monthly increase.

A total of 22,291 foreclosures were taken to sale at auction, representing loan value of $9.57 billion, ForeclosureRadar said. Opening bids set by lenders were an average of 39.3 percent lower than the loan balance, with 46 percent of sales discounted by 50 percent or more.

Notice of trustee sales dropped 28.7 percent, with the timing of the decrease suggesting a response to the California Foreclosure Prevention Act, the company said. …CONTINUED

Notice of Trustee Sale filings dropped by nearly 50 percent the day the new law went into effect, despite the fact that a number of lenders were exempt from the law because they can demonstrate they have a comprehensive loan modification program in place, said ForeclosureRadar CEO Sean O’Toole in a press release.

A report issued Wednesday by the Federal Housing Finance Agency showed that loan servicers collecting payments on 30 million loans owned or guaranteed by Fannie Mae and Freddie Mac completed 12 percent fewer loan modifications in April than in March — 13,800.

The reduction was attributed to Fannie and Freddie ending their Streamlined Modification Program (SMP) and implementing the Home Affordable Modification Program (HAMP).

HAMP loan modifications require a three-month trial period for the borrower to demonstrate the ability and willingness to make modified payments, FHFA said. Modifications under HAMP are counted as completed after the three-month trial period is completed.

Fannie and Freddie loan servicers boosted short sales and deeds in lieu of foreclosure by 15 percent in April 2009, to nearly 4,000 — more than three times the volume one year earlier, FHFA said.


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