November 10, 2011 / 5:01 AM / 8 years ago

U.S. foreclosure activity rises in Oct -RealtyTrac

NEW YORK, Nov 10 (Reuters) - Lenders seized more U.S. homes and sent out more first-time default notices in October, suggesting the backlog of foreclosure activity has started to flow again, a report by RealtyTrac said on Thursday.

Default notices were filed on 77,733 properties last month, up 10 percent from September. Notices on states that use the judicial process to handle foreclosures jumped 16 percent to an 11-month high.

Lender repossessions rose 4 percent to 67,624 homes.

Both categories, however, saw declines from a year earlier, with overall notices down 23 percent from October a year ago and repossessions down 27 percent.

Foreclosure activity was halted temporarily late last year due to claims that lenders relied on “robo-signing,” a practice in which documents were signed without a review of the case files.

“It’s good to start to see more of a flow because we know there is a backlog,” said RealtyTrac Chief Executive Jim Saccacio.

“There are over 1.5 million properties in foreclosure, 3.6 million delinquent loans and then you add that 12 million underwater negative equity properties. If the economy doesn’t get better, that’s got to trickle through the system,” he said.

Total foreclosure filings — which include default notices, scheduled auctions and bank repossessions — were up more than 7 percent, but still down nearly 31 percent year-over-year.

Nevada continued to hold the top spot for state foreclosure rates. But Las Vegas, after having the highest foreclosure rate among metropolitan areas with a population of 200,000 or more for 22 straight months, dropped to fifth place.

Stockton, California, took the top spot with one in every 143 homes subject to a foreclosure filing in October.

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