Foreclosure Filings Hit 7-Month High As ‘Robo’ Cases Backlog Eases

Foreclosure filings — default notices, scheduled auctions and bank repossessions — were reported on 230,678 U.S. properties in October, a 7 percent increase from the previous month and a seven-month high, according to RealtyTrac’s latest report.
Although October’s figure is down nearly 31 percent from October 2010, the recent surge is an indication that lenders are making their way through the backlog caused by shoddy paperwork and the “robo-signing” scandal of the past year. Many banks temporarily ceased foreclosures, re-filed many cases and reviewed pending cases anew to prevent errors.
Lenders repossessed a total of 67,624 U.S. properties, or REOs, in October, a 4 percent increase from the previous month. This represents a 27 percent decrease from October 2010.
However, REO activity increased 40 percent or more on a month-over-month basis in several states, including Michigan (40 percent), Oregon (45 percent), New Jersey (48 percent), and Indiana (73 percent).
“The October foreclosure numbers continue to show strong signs that foreclosure activity is coming out of the rain delay we’ve been in for the past year as lenders corrected foreclosure paperwork and processing problems,” said James Saccacio, chief executive officer of RealtyTrac.
However, recent court rulings and new state laws “keep changing the rules of the foreclosure game on the fly,” creating more uncertainty in the housing market and a prolonged foreclosure crisis.
Despite a 34 percent month-over-month drop in foreclosure activity, Nevada had the nation’s highest state foreclosure rate for the 58th straight month in October.
California posted the nation’s second highest rate with default notices jumping 17 percent from the previous month to a 13-month high. One in every 243 housing units in California had a foreclosure filing in October. Arizona posted the nation’s third highest state rate in October, with one in every 259 housing units getting a foreclosure filing.

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