Foreclosures - Short Sales Feed

Foreclosures 'boil over' in judicial foreclosure states

Foreclosure-related filings were down sharply from a year ago nationwide in August despite an increase in foreclosure activity in 20 states, particularly in states where courts handle the foreclosure process, including New Jersey, New York, Maryland, Illinois and Pennsylvania.

According to the latest numbers from data aggregator RealtyTrac,  193,508 homes were hit with foreclosure-related filings last month, including  notices of default, auction notices and bank repossessions. That's an increase of 1 percent from July, but a 15 percent  decrease from a year ago.

Foreclosure starts were up 1 percent from July to August, with 99,405 homes entering the foreclosure pipeline, down 13 percent from a year ago. Bank repossessions were also down on a year-over-year basis for the 22nd month in a row, RealtyTrac said. Lenders  repossessed 52,380 homes in August, down 2 percent from July and 6 percent  from a year ago.


Source: RealtyTrac

Bucking  the national trend, foreclosure-related filings "boiled over" in  August in several states where courts handle the foreclosure process,  including Illinois and Florida, said Daren Blomquist, vice president of  RealtyTrac, in a statement.

An increase in short sales and foreclosures was predicted in judicial foreclosure states after the nation's five largest mortgage servicers reached a $25 billion settlement in March over "robo-signing" allegations. 

While foreclosure-related filings were down 31 percent collectively from a year ago in the 24 nonjudicial states and District of Columbia, some judicial foreclosure  states saw big annual increases in foreclosure activity, led by Kentucky (up 73 percent), New Jersey (up 65 percent), New York (up 56 percent), and Maryland (up 54 percent).

Foreclosure-related filings were up from a year ago in 20 states in August, including Illinois, which posted the highest rate of any state with 1 in every 298 housing units. A total of 17,781 Illinois properties were subjected to a foreclosure-related filing in August, -- a 42 percent increase from  a year ago.

Florida climbed to second on RealtyTrac's list of states with the highest rate of foreclosure-related filings, with 1 in 328 properties subjected to a filing.

Until August, the top two spots on the list have been held by one of four nonjudicial foreclosure states since December 2010: Arizona, California, Georgia and Nevada.

10 states with highest foreclosure rate

Rank State August 2012 Properties with Foreclosure Filings 1/every X Housing Units Percent change from July 2012 Percent change from Aug. 2012
1 Illinois 17,781 298 29.09 42.33
2 Florida 27,422 328 7.39 16.35
3 California 40,200 340 -4.47 -32.30
4 Arizona 7,899 360 -3.87 -28.72
5 Nevada 2,921 402 3.33 -69.82
6 Georgia 9,478 431 -12.73 -19.29
7 Ohio 9,218 556 -5.15 -6.33
8 Michigan 7,648 593 -12.66 -41.24
9 Delaware 665 610 180.59 1.68
10 Colorado 3,584 617 24.66 -27.35

Source: RealtyTrac

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New Short Sales Rules - Cheat Sheet

New Short Sales Rules - Cheat Sheet Recently the Federal Housing Finance Agency announced that both Fannie Mae and Freddie Mac are issuing new guidelines for mortgage servicers that will essentially consolidate all short sale programs into one streamlined program. These updated short sale program rules will allow lenders to qualify someone for a short sale, and homeowners will more easily be able to tell if they are eligible for a short sale. Under the new guidelines going into effect Nov. 1: - Homeowners with a mortgage backed by Fannie Mae or Freddie Mac will be able to do a short sale even if they are current on their mortgage if they have an eligible hardship such as the death of a borrower or co-borrower, divorce or legal separation, illness or disability, or a distant employment transfer. - Homeowners will be able to make a financial contribution at closing in exchange for the lender not pursuing them for a deficiency judgment later (assuming the homeowner has sufficient income and/or assets). - Milita ry personnel who are being relocated will be automatically eligible for a short sale and will be under no obligation to contribute funds to cover the shortfall between the outstanding loan balance and the sales price on their homes. - Subordinate-lien payments will be limited to $6,000. Previously lenders would often attempt to negotiate a higher payment from the homeowner. - In certain circumstances, homeowners will be eligible to receive up to $3,000 in relocation assistance. New guidelines for lenders The FHFA also recently announced that lenders: - Must respond to short sales within 30 days of receipt of the short sale offer. - Must provide weekly updates to the borrower. - Must communicate a final decision to the borrower within 60 days of receipt of the offer.