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Home foreclosures in North Carolina drop 8.5% in June

Posted July 10, 2008
Updated July 11, 2008

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— Home foreclosures in North Carolina declined 8.5 percent in June from May’s total but legal actions were 78 percent higher than in June of 2007, according to statistics released Thursday.

North Carolina, the 10th largest state in population, ranked 25th in foreclosure actions last month, mortgage tracking firm RealtyTrac said.

Some 2,150 property owners received notices of default and another 1,130 were foreclosed or repurchased by a bank in June. Other legal proceedings involved another 185 properties. Overall, 1 in every 1,163 properties was involved in some sort of foreclosure action.

Nationally, foreclosure filings grew by more than 50 percent compared with June a year ago.

According to RealtyTrac, 252,363 homes received at least one foreclosure-related notice in June, up 53 percent from the same month last year, but down 3 percent from May, RealtyTrac Inc. said. One in every 501 U.S. households received a foreclosure filing last month.

Foreclosure filings increased from a year earlier in all but 11 states. Nevada, California, Arizona, Florida and Michigan continued to have the highest foreclosure rates.

Irvine, Calif.-based RealtyTrac monitors default notices, auction sale notices and bank repossessions. More than 71,000 properties were repossessed by lenders nationwide in June, the company said.

While foreclosures continue to rise nationwide, efforts in some states to give borrowers more time before losing their homes appear to be working.

In Maryland, where a new law has increased the time to finalize a foreclosure to 150 days from just 15, foreclosure filings dropped by almost 18 percent from last year's levels. In Massachusetts, which last year passed a similar law, filings dropped almost 3 percent.

Still, the combination of weak housing sales, falling home values, tighter mortgage lending criteria and a slowing U.S. economy has left financially strapped homeowners with few options to avoid foreclosure. Many can't find buyers or owe more than their home is worth and can't refinance into an affordable loan.

Economists project 2.5 million homes nationwide will enter the foreclosure process this year, up from about 1.5 million in 2007.

Analysts say the mortgage industry's effort to assist troubled borrowers is being overwhelmed by the magnitude of the foreclosure crisis, and Treasury Secretary Henry Paulson said earlier this week that many foreclosures are "not preventable," citing borrowers who "took out mortgages they can't possibly afford and they will lose their homes."

Lawmakers and government officials have been struggling to come up with a response to soften the blow for the U.S. economy. Congress is working on legislation that would permit the Federal Housing Administration to provide new, cheaper mortgages to distressed homeowners who otherwise would have difficulty refinancing into more secure government-insured loans. Lenders would have to be willing to take a substantial loss by reducing the amount owed on the loan.

The Bush administration announced Tuesday that it would be ready on Monday to implement an FHA expansion that lets borrowers who've fallen behind on their home payments - because of mortgage rate resets or other economic hardships - get more affordable loans.

In the RealtyTrac report, metropolitan areas in California and Florida accounted for nine of the top 10 areas with the highest rate of foreclosure for the third-straight month. That list was led by three California cities: Stockton, Merced and Modesto. The Cape Coral-Fort Myers area in Florida was fourth.

In Nevada, one in every 122 households received a foreclosure-related notice last month, more than four times the national rate.

In today's market, about 50 to 60 percent of borrowers nationally who receive foreclosure filings are now likely to lose their homes, said Rick Sharga, RealtyTrac's vice president of marketing, compared with a typical rate of about 40 percent.

"For more and more homeowners who are getting into foreclosure," Sharga said, "there is a much higher likelihood that they are ultimately going to lose the properties to the bank."

8 Comments

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  • winonedog Jul 10, 2008

    we are the 11th most populated state.

  • Xiaoding Jul 10, 2008

    To get the foreclosure rate down, just don't issue any foreclosures! Simple. The banks are doing anything they can to prop up this rate. Month on month figures mean nothing, only year on year matters, and YOY is up 53%.

    Never trust the figures from the Real Liers. They are in business to sell houses.

    As for people losing homes, it's bull. Most of the foreclosures are on peple who own more than one home!

  • OpinionatedGuy Jul 10, 2008

    This is an awful shame that people are losing their homes... Most homes are financed through Countrywide home loans and they are being sued by many states and many people... I sure hope BofA knows what they are getting into... if you own stock in either of these companies... It is time to dump them...

  • TheAdmiral Jul 10, 2008

    "These 'statistics' are from a trade organization - not an independent agency."

    I respect the numbers from a trade organization more than I do an independent agency. Why? Because there is no way in HE Double Hockey Sticks would I allow an outsider in to come and look at my books.

    Sean Kelly, I am an independent agency, and I want to look at your tax records for the last 7 years. Choke them up.

  • simracer68 Jul 10, 2008

    seankelly, a "collections call" if you are late with 1 payment can be construed as a "legal proceeding". A foreclosure is not a foreclosure until the bank or lending institution or government agency that guaranteed the loan (VA, FHA, etc) actually evicts the occupants, secures the property and takes actual (deeded) possession.

    General comment: Why, oh why, should the government intervene into this situation? People that owe more money on their homes than they're worth - in most cases - are in that situation because they cashed out their equity on some insane 110% LTV loan and blew the money. That's not a government responsibility, that's (a lack of) personal responsibility.

    AND foreclosures in and of themselves DO NOT lower YOUR home value unless they are in your neighborhood and are the predominant sales activity at the time your home is appraised, and therefore must be used as the comparable sales in order to derive the value opinion.

  • nodoginthisfight Jul 10, 2008

    whatelseisnew ... your exactly right most economist said the foreclosure problem would begin to correct itself in the second half of the year without gov. intervention. Well looks like they were right and congress was wrong....again.

  • whatelseisnew Jul 10, 2008

    there is no response that the Government can do. This problem will have to sort itself out. Yes, it means people will lose their homes. Sometimes you win, sometimes you lose.

  • seankelly15 Jul 10, 2008

    These 'statistics' are from a trade organization - not an independent agency. And, because this story does not provide any numbers, there is no way to know what the actual trend was. It seems implausible that legal proceedings would be up 78% but the rate of foreclosure down 8.5% (not sure how this was operationalized - was this an actual foreclosure, the notice that the process was beginning or a warning to the homeowner that unless they pay a certain amount, foreclosure would begin)?