U.S. home foreclosures rise in January

NEW YORK Thu Feb 10, 2011 9:58am EST

The sign for a foreclosed house for sale sits at the property in Denver, March 4, 2009. REUTERS/Rick Wilking

The sign for a foreclosed house for sale sits at the property in Denver, March 4, 2009.

Credit: Reuters/Rick Wilking

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NEW YORK (Reuters) - U.S. home foreclosures jumped 12 percent last month, but the sharp divide between states suggests the industry remains backlogged by investigations into the foreclosure process.

According to a report from real estate data firm RealtyTrac, lenders foreclosed on 78,133 properties in January, up 12 percent from the month before, but down 11 percent from January a year ago.

Bank seizures at states with non-judicial foreclosure processes jumped 23 percent, while states with a judicial process saw a decrease of 7 percent.

"It suggests the system is still frozen up. We should have seen a much larger increase in both overall activity and bank repossession," said Rick Sharga, senior vice president at RealtyTrac.

"The numbers will inevitably go up, it's just a question of will it be sooner or will it be later."

The number of foreclosure filings, which includes default notices, scheduled auctions and bank repossessions, rose 1 percent to 261,333 in January. Compared to January last year, filings are down 17 percent.

The report also showed 1 in every 497 houses received a foreclosure filing during the month. Five states -- California, Florida, Michigan, Arizona and Illinois -- continued to account for more than half of all foreclosure filings. California alone accounted for more than one quarter.

Nevada, Arizona and California also had the highest foreclosure rates. Nevada had the country's highest foreclosure rate for the forty-ninth month in a row. One in every 93 Nevada homes received a foreclosure filing in January, more than five times the national average, RealtyTrac said.

Ongoing foreclosures are a major headwind for a market that is already struggling with a glut of unsold houses. Data from Zillow Inc earlier in the week showed the number of single-family homes where the mortgage is worth more than the home increased to 27 percent in the fourth quarter from 23.2 percent the previous quarter, suggesting more potential foreclosures to come.

(Reporting by Leah Schnurr; Editing by Diane Craft)

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Comments (5)
Chuck247 wrote:
OK from my personal experience (I was foreclosed on by Wells Fargo)
I had a verbal agreement to stop the process (they didn’t) if I would make 1 payment (I was behind 2 months) didn’t stop it. Next their mortgage department agreed if I would pay all 3 late months up to date they would stop the process. (didn’t happen) Ended up having to pay off the whole mortgage. The time is of essence letter gave me 7 days to pay
up before the process started thats too short to react. I live in Michigan where foreclosure by advertisement is permitted and I’m a licensed real estate broker. This needs to change.

Feb 10, 2011 4:27am EST  --  Report as abuse
Chuck247 wrote:
I was foreclosed on in Michigan, due process doesn’t exist here.

Feb 10, 2011 4:31am EST  --  Report as abuse
DrJJJJ wrote:
Those that walk away from their contractual obligation to tax payers because of negative equity alone, should be required to pay mortgage insurance for life on all future home loans! In the interest of fairness and equality!

Feb 10, 2011 11:39am EST  --  Report as abuse
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