Fewer homes lost
LOS ANGELES — Lender processing delays reduced the number of U.S. homes taken back by banks in the first three months of the year and contributed to a sharp drop in properties entering the foreclosure process.
But March foreclosure data suggest foreclosure activity may be starting to creep higher, as lenders make progress tackling a backlog of pending foreclosure cases.
Banks repossessed 215,046 homes in the January to March quarter, down 6 percent from the fourth quarter and down 17 percent versus the same period last year, foreclosure listing firm RealtyTrac said Thursday.
The number of properties receiving a notice of default for the first time also declined, falling 17 percent from the fourth quarter and 35 percent from the first three months of last year, the firm said.
The drop-off in foreclosure activity stems from foreclosure documentation problems that came to light last fall. Many banks have since revisited thousands of foreclosure cases, delaying the processing of new foreclosures. The logjam has been compounded by court delays in states where foreclosures must be approved by a judge.
Still, between February and March, the number of properties repossessed by banks rose 13 percent, the highest increase in a year. And homes receiving their first notice of default climbed 16 percent.
“The bottleneck is opening up a little bit and we’re starting to see the first inklings that we might be getting back to more normal levels of foreclosures,” said Rick Sharga of at RealtyTrac.
By normal levels, Sharga means the elevated pace of foreclosure activity that led to more than 1 million homes being taken back by lenders last year.
