Bank Repossessions Increase by 129%

Posted on April 30th, 2008 by saman

In the past twelve months, foreclosure filings have increased by fifty seven percent and repossessions by banks have risen to one hundred twenty nine percent from last year.In March, default notices, foreclosure filings, bank repossessions, and auction notices have risen by five percent. These figures are led by Florida, California, and Nevada. RealtyTrac, a company that keeps track of mortgages and foreclosures, said that what is being seen is the fallout from those individuals who have been buying homes they could not afford by bad loan practices. These loan practices were used to get individuals into homes that they could not afford to begin with. It is believed that there may be a record amount of foreclosures in the last two quarters of the year. This would be a reflection of the payment increases on subprime loans in the months of May and June. One out of five hundred households in the United States who are living in a single family home, have received a foreclosure notice.In most states, the foreclosure process is three fold. There is the first default notice, a notice about an auction that has been scheduled, and a “REO” or real estate owned property, filing if the home is not bought at auction but is repossessed. Auction notices rose minimally in March while repossessions and default notices soared. This suggests that more distressed homeowners are walking away from their homes and giving them back to the bank. This is “deed-in-lieu-of-foreclosure” and it allows the bank to take back the property without putting the property up for foreclosure. The states of California, Nevada, and Florida have the largest price appreciation in the housing boom before the housing meltdown began in 2006. These states are plagued with defaults on empty homes. Home prices are now under the mortgage value and some homeowners are just leaving. Last month in Nevada, one out or every one hundred and thirty nine household got a foreclosure filing. This keeps Nevada at the top of foreclosure rankings for the fifteenth month in a row. Over seven thousand homes in Nevada received foreclosure notices in March. In Arizona foreclosure filings dropped about five percent but it remains the state with the fourth highest foreclosure activity for the third month in a row. In Colorado, foreclosures have fallen by eight percent in March but it still has the fifth highest foreclosure rate. One in every three hundred household are in the process of foreclosure. Maryland, Georgia, Massachusetts, Ohio, and Michigan also had high foreclosure rates last month. California, Ohio, and Florida have the highest rates of foreclosure. In California, over sixty four thousand properties were in the foreclosure process last month. This is a twenty one percent jump since February and an increase of almost one hundred and six percent since last year at this time. Florida had over thirty thousand properties in foreclosure last month. Though this is down seven percent since the month of February, the number of foreclosure filings was one hundred and twelve percent higher than last month.