The number of U.S. homes repossessed by lenders in February fell to the lowest level since 2007, according to a new report from foreclosure data company RealtyTrac, even as the number of homes entering the foreclosure process increased.
The report showed that 45,038 homes were repossessed in February, down 11 percent from January and down 29 percent from one year earlier. Monthly completed foreclosures are now less than half of their recession peak of 102,000 homes in March 2010. (To put things in perspective though, the current pace is still more than double the normal historical average of 20,000 a month.)
States like Oregon and Massachusetts led the dramatic decline with decreases in repossessions of 78 percent and 69 percent, respectively. On the other end were states like Washington, Wisconsin and Iowa where the numbers jumped up again.
“The U.S. foreclosure inferno has been effectively contained and should be reduced to a slow burn in the next two years,” Daren Blomquist, vice president at RealtyTrac, said in the report as quoted in a Bloomberg article. “It’s definitely safe to say we’re past the worst of it at a national level,” he added.
The overall drop in foreclosure repossessions is being fueled by many factors. Improvements in the job market are helping homeowners stay on top of their mortgages, as are uber-low mortgage interest rates. Long-term rates that are hovering around 3.5 percent are making it possible for more homeowners to refinance in to better loan terms. Plus, many lenders today are making it easier for struggling borrowers to receive mortgage modifications or short sales, as alternatives to foreclosure.
Yet as the number of new foreclosure filings increased 10 percent in February from the month before, the first monthly gain in three months, signaling that while we may have ‘past the worst’ of the foreclosure crisis, there remain plenty of foreclosures to work through before the market returns to full health.
About Amber Nelson“Dangerous foreclosure flare-ups are still popping up in states where foreclosures have been delayed by a lengthy court process or by new legislation making it more difficult to foreclose outside of the court system,” said Blomquist. He also commented, “When we dig down into local markets, there’s still a foreclosure problem that needs to be dealt with.”
Amber Nelson is a seasoned mortgage industry writer and a regular contributor to Loan.com and Mortgage101.com.
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