Foreclosure Activity Slows to 40 Month Low

May 12, 2011 No Comments »

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Foreclosure activity slipped for a seventh straight month in April, according to foreclosure listing service RealtyTrac.

The company said foreclosure activity is now at a 40-month low, though bank repos hit a record high in Nevada, and mortgage defaults spiked in Massachusetts and New Jersey.

Overall, default notices, scheduled auctions and bank repossessions were reported on 219,258 U.S. properties last month, down nine percent from March and 34 percent from April 2010.

But before you pop the champagne, note that while foreclosure activity has slowed, it’s probably just delayed.

RealtyTrac CEO James J. Saccacio stated in a release that mortgage lenders are no longer “automatically pushing loans” 90 days delinquent into foreclosure, but are instead holding out for alternatives, such as loan modifications and short sales.

For example, foreclosures completed (REO) nationwide in the first quarter took an average of 400 days from initial default (missed mortgage payment) to notice of REO (bank repo), up from 340 days a year ago, and more than double the 151 days it took back in 2007.

Think that’s long? In New York and New Jersey, where the process involves the courts, the foreclosure timeline was more than 900 days in the first quarter.

Things were different in Nevada.  Although overall foreclosure activity in the Silver State decreased nine percent from the previous month and was down 27 percent from April 2010, bank repos increased 23 percent from March and were up 12 percent from April 2010 to their highest level on record.

Nationwide, lenders foreclosed on 69,532 properties last month, down five percent from March and 25 percent from April 2010, but bank repos were still above a 22-month low seen back in February.

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