In the third quarter, a downward trend in nationwide foreclosure activity showed signs of reversing, according to the latest report from foreclosure data site RealtyTrac. At the same time, foreclosure processing and sales timelines hit record highs, the report said.

After three straight quarters of declines, foreclosure activity in the third quarter remained essentially flat compared to the second quarter, rising a slight 0.35 percent to filings on 610,337 properties. That’s still a 34.4 percent decrease compared to third-quarter 2010.

One in every 213 housing units received a filing — a default notice, scheduled auction, or bank repossession — in the third quarter.

In September, the last month of the third quarter, 214,855 properties received a foreclosure filing, a decrease of 6 percent month to month and 38 percent year over year. September marks a full 12 months in which foreclosure filings have been dropping on a yearly basis, the report said.

"U.S. foreclosure activity has been mired down since October of last year, when the robo-signing controversy sparked a flurry of investigations into lender foreclosure procedures and paperwork," said James Saccacio, RealtyTrac’s CEO, in a statement.

"While foreclosure activity in September and the third quarter continued to register well below levels from a year ago, there is evidence that this temporary downward trend is about to change direction, with foreclosure activity slowly beginning to ramp back up."

Saccacio attributed the third quarter’s marginal increase in foreclosure activity to a jump in new default notices, "indicating that lenders are cautiously throwing more wood into the foreclosure fireplace after spending months … trying to clear the chimney of sloppily filed foreclosures," he said.

Default notices in the third quarter rose 14 percent from the second quarter, to 195,878, but remained down 27 percent compared to third-quarter 2010. States to see especially big jumps in default notices quarter to quarter were Massachusetts (65 percent), New Jersey (29 percent), Florida (24 percent), Ohio (21 percent), and California (21 percent).

Foreclosure auctions fell 6 percent quarter to quarter and 41 percent year over year in the third quarter, to 217,929.

Bank repossessions (REOs) fell 4 percent quarter to quarter and 32 percent year over year, to 196,530. Nevertheless, some states did post high quarter-to-quarter jumps in REOs: Massachusetts (up 62 percent), Oregon (47 percent), Georgia (42 percent), and Illinois (27 percent).

Nevada, California and Arizona topped the list of states with the nation’s highest foreclosure rates in the third quarter.

Area Foreclosure rate (Q3)
U.S. 1 in 213 housing units 
Nevada 1 in 44 
California 1 in 88
Arizona 1 in 93
Georgia 1 in 121
Florida 1 in 130
Utah 1 in 145
Michigan 1 in 146
Idaho 1 in 157
Illinois 1 in 164
Colorado 1 in 168

Source: RealtyTrac

Foreclosure processing and sales timelines hit record highs in the third quarter. Properties foreclosed last quarter took an average of 336 days to complete the foreclosure process. That’s up from 318 days in the second quarter and the highest number of days since first-quarter 2007, the report said. The three states to post the highest foreclosure processing timelines were New York (986 days), New Jersey (974 days), and Florida (749 days) — more than two years each.

The three states to post the shortest processing timelines in the third quarter were Texas (86 days), Kentucky (94 days), and Virginia (102 days).

Properties sold in the third quarter during the foreclosure process, typically short sales, took an average of 318 days to sell, up from 245 days in the second quarter, the report said. REOs, on average, took more than six months to sell in the third quarter (193 days) after repossession, up from 178 days in the second quarter.

Among the 25 metro areas with the nation’s highest foreclosure rates and populations of 200,000 or more, foreclosure starts increased on a quarterly basis in 21 out of 25. Foreclosure starts could be default notices or scheduled auctions, depending on the state’s foreclosure process, RealtyTrac said.

Only Greeley, Colo.; Boise, Idaho; and Phoenix and Prescott, Ariz., saw foreclosure starts decline in the third quarter from the previous quarter, the report said.

Among that top 25, 15 of the metros were in California, two were in Arizona, two were in Florida, and two were in Nevada, with Las Vegas topping the list. While all 25 saw their foreclosure activity drop on a yearly basis in the third quarter, 15 of 25 saw their foreclosure activity rates rise on a quarterly basis.

MSA Name 1/Every X housing unit
% ch. compared to Q2 2011 % ch. compared to Q3 2010
Las Vegas-Paradise, Nev. 39 -12.30 -34.17
Vallejo-Fairfield, Calif. 51 19.80 -11.33
Stockton, Calif. 52 8.48 -25.35
Modesto, Calif. 53 1.35 -31.38
Riverside-San Bernardino-Ontario, Calif. 56 -0.67 -27.13
Merced, Calif. 62 10.68 -34.99
Bakersfield, Calif. 64 -2.10 -30.09
Sacramento–Arden-Arcade–Roseville, Calif. 64 5.38 -22.11
Reno-Sparks, Nev. 67 -4.32 -25.16
Fresno, Calif. 70 10.37 -16.86
Visalia-Porterville, Calif. 76 1.11 -21.18
Phoenix-Mesa-Scottsdale, Ariz. 80 -29.17 -44.33
Oxnard-Thousand Oaks-Ventura, Calif. 88 12.31 -8.88
Atlanta-Sandy Springs-Marietta, Ga. 89 22.25 -18.41
Cape Coral-Fort Myers, Fla. 92 -20.43 -61.59
Salinas, Calif. 95 15.72 -15.79
Santa Rosa-Petaluma, Calif. 97 7.02 -8.46
Prescott, Ariz. 98 -16.33 -26.22
Greeley, Colo. 105 -11.29 -38.96
Los Angeles-Long Beach-Santa Ana, Calif. 107 5.06 -14.98
San Diego-Carlsbad-San Marcos, Calif. 108 6.79 -23.69
Detroit-Warren-Livonia, Mich. 108 -8.92 -35.01
Miami-Fort Lauderdale-Pompano Beach, Fla. 108 12.77 -61.77
Boise City-Nampa, Idaho 109 -9.25 -51.64
San Francisco-Oakland-Fremont, Calif. 112 11.11 -15.13

Source: RealtyTrac.

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