Foreclosures surge 18% across North Carolina in February

Posted March 15, 2012
Updated March 16, 2012

Foreclosure activity in North Carolina surged nearly 18 percent in February from the previous month as part of a nation-wide trend in which banks tackled a backlog of homes with mortgages that had gone unpaid yet remained in limbo due to delays stemming from foreclosure-abuse claims.

The increase occurred across 26 states where the courts supervise the foreclosure process. In contrast, the 24 states where the courts do not play a role in the process saw activity decline in February, foreclosure listing firm RealtyTrac Inc. said Thursday.

In North Carolina, RealtyTrac reported 2,992 foreclosure actions. Of those, 485 were in Wake County and 44 were in Durham County.

Mecklenburg County had the most at 852. Forsyth County was third with 390, and Guilford County had 318, RealtyTrac said.

The February total was 17.75 percent higher than in January.

However, the total was 2.9 percent less than February 2011, according to RealtyTrac data.

While uneven, the pace of foreclosures is accelerating following a $25 billion settlement reached last month between the nation's biggest mortgage lenders and state officials. The settlement was over the industry's alleged foreclosure abuses.

Major banks temporarily put foreclosures on hold in the fall of 2010 after claims surfaced that lenders and mortgage servicers were processing foreclosures without verifying documents. As a result, many homes that would have normally ended up foreclosed were left in a procedural limbo, particularly in states where courts play a role in the process.

But that logjam has begun to ease, and banks are moving to sort out their roster of problem mortgages.

"We're not just seeing an increase in properties starting the foreclosure process, as we have in previous months, but we're starting to see dramatic increases in properties completing the foreclosure process in many of those judicial foreclosure states," said Daren Blomquist, a vice president at RealtyTrac.

That means potentially more foreclosed homes hitting the market this year that could drag down the value of neighboring homes.

Among states with a judicial foreclosure process, foreclosure activity rose 2 percent last month from January, and climbed 24 percent from February last year, the firm said.

Foreclosure activity across states without a court-supervised process fell 5 percent in February from the previous month and declined 23 percent from a year earlier.

RealtyTrac bases foreclosure activity on filings that signal when a home is in some stage of the foreclosure process: an initial default notice, a scheduled home auction or a home repossession, which is when a property goes back to the lender.

Overall, U.S. foreclosure activity dipped 2 percent from January and was down 8 percent from February last year.

Taken individually, some states registered far higher increases in foreclosure activity last month.

Default notices, the first step in the foreclosure process, edged up 1 percent nationally last month from January, but fell 7 percent on an annual basis. But several states posted big annual increases, including Hawaii (321 percent), Maryland (157 percent) and Florida (33 percent) — all three states where courts play a role in foreclosures.

Initial default notices fell sharply in several states, including Nevada (89 percent) and Michigan (72 percent). New York bucked the trend of other judicial states, posting an annual drop of 44 percent in default notices last month.

Banks repossessed 63,834 U.S. homes last month, down 4 percent from January and a decline of 1 percent from February last year, RealtyTrac said.

Once more, the national figures don't tell the whole story, however.

Repossessions skyrocketed in February versus a year earlier in Massachusetts (114 percent), North Carolina (95 percent), Florida (90 percent) and Georgia (76 percent), among other states.

"At the end of the day in 2012, we are going to see an increase in foreclosures nationally from 2011," Blomquist said.

RealtyTrac projects foreclosures will rise 25 percent this year to more than 1 million homes. Last year, lenders took back 804,000 homes.

More than 6 million homeowners were either behind on their mortgage payments or in foreclosure at the end of last year, by some estimates. And about a quarter of all U.S. homeowners, some 11 million, are underwater on their homes, owing more on their mortgages than their homes are worth, according to CoreLogic, a real estate data firm.

At the state level, Nevada continued to post the nation's highest foreclosure rate last month, with one in every 278 households in the state receiving a foreclosure-related filing. That's more than twice the national average.


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  • mike275132 Mar 16, 2012

    Yeah deregulation is grand…especially when talking about home loans and them failing….

    Wrong Again Comrade WooHoo2You,

    The Gubmint forced banks to lend to Unqualified buyers- you know Barney Frank, Chris Dodd Fannie Mae Freddie Mac fraud loans made by the Gubmint?

    So about 10% of homes sold in the Late 2000's were to unqualified "Buyers", you know Obama voters like youself and end up getting foreclosed on because you have to pay your mortgage.

    Good for me though , 'cause now I can buy homes at 50-80% off and rent them to evicted Obama voters.

    Got to love all this - Change We Can Believe In!

  • readme Mar 16, 2012

    Foreclosures are good, and the market needs this correction. For those of us that rent until we can actually pay 20% down and carry a fixed rate mortgage, this is a good thing. If the government takes my tax dollars and props up the housing market or bails our borrowers and lenders, it just penalizes the rest of us. I like that I have more choices as a buyer this coming year.

  • WooHoo2You Mar 16, 2012

    If the Government had stayed out of this, the foreclosures would have been completed sooner and the bottoming of the housing market would have been reached sooner.- whatelseisnew

    Yeah deregulation is grand…especially when talking about home loans and them failing….

  • WooHoo2You Mar 16, 2012


    (That makes news disappear, right?)

  • muggs Mar 16, 2012

    The pirhana that created this mess are still feeding from the carcus of our government,the mortgage companies and banks are still doing business after being bailed out do to the fact they made some questionable loans,both parties are at fault the lender,and the recipient of that loan,one got bailed out the other not as fortunate,these acts of forclosure may be deserving to some but many others are avoidable probably and could be worked out if the owners are just having a difficult time,past work history will verify many were making payments until the bottom fell out and would continue once they got back on their feet,others just went in over their head and capability ever to be able to make payments.

  • Gork Mar 16, 2012

    "whatelseisnew", or whatever - "if the government had stayed out of this" - you mean, let banksters foreclose with fraudulant documents, without having evidence they even own the properties, by forging documents and signatures, stuff like that to speed up the process?

  • Gork Mar 16, 2012

    The reason to "prolong the pain" is the bank's position - if they foreclose they have to mark down the value of the mortgage on their books, which is currently sitting there at the original value. That might put a crimp in the multimillion dollar bonuses they're paying each other...

  • whatelseisnew Mar 16, 2012

    Not at all surprising. If the Government had stayed out of this, the foreclosures would have been completed sooner and the bottoming of the housing market would have been reached sooner. It is pretty simple, Person A signed a mortgage Loan Agreement. Person A stops paying. Lender can then take the property because that was the collateral used to obtain the loan.
    A foreclosure can not happen if you pay the loan. I wish more people were irate over the fact the Government taxes property and can steal it from you if you can not pay the tax. It is long past time to end this barbaric Government behavior.

  • Barely Mar 16, 2012

    There was a push for the government to buy out foreclosed homes. That would have essentially made the government glorified landlords, as they would hand out homes at reduced prices to people who couldn't normally make house payments. As a result it would have killed the value of other homes in the same neighborhoods, causing more upside-down loans for those homeowners, and creating more problems. In other words, government meddling has about the same chance of making matters worse as it does of making them better. The only difference is one situation gives more power to the feds while the other keep power on the public side.

  • streetglide Mar 16, 2012

    don't fall political hog wash,, the economy is in the same shape it has been in now for 4 years "terrible", now our goverment officials are telling us, everything is much better now,, view the facts for yourself,, and DON'T BELIEVE EVERYTHING OUR LEADERS SAY, Facts are FACTS, that is just the way it is! but some can't handle the truth!!