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Foreclosures drop sharply in North Carolina

Posted April 14, 2011

The foreclosure market is improving in North Carolina, according to new data from foreclosure listing firm RealtyTrac.

Foreclosure activity in March declined 31 percent from a year ago with 2,444 properties at some stage of bank action, the company said. Actions were down 21 percent from February.

For the first quarter, actions across the state fell 27.1 percent from the fourth quarter of 2010 and 11.7 percent from the same quarter a year ago.

However, it was lender processing delays reduced the number of U.S. homes taken back by banks in the first three months of the year, RealtyTrac noted.

Overall  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 Inc. 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 such as Florida, New York, and New Jersey, 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, a senior vice president 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.

Roughly 5 million borrowers are at least two months behind on their mortgages, by some estimates. And many of the factors that have contributed to the foreclosure crisis are likely to continue driving foreclosures this year, including high unemployment, a weak housing market, falling home values and tighter lending standards.

The foreclosure processing delays remain most pronounced in states where judges play a role in the foreclosure process.

In Florida, for example, foreclosure activity has fallen 47 percent since the fourth quarter, and it's taking nearly 17 months from the time a property receives its initial notice of default until it is put up for auction. That process normally takes about four months, Sharga said.

In New Jersey and New York, other states where judges play a role in foreclosures, the process is taking nearly 27 months.

"The timelines have extended across the country as the foreclosure problem has spread, but those are probably the most egregious examples," Sharga said.

In states where judges aren't part of the process, home repossessions rose by 9 percent in the first quarter versus the fourth quarter, RealtyTrac said.

The firm has predicted between 1 million and 1.2 million homes will be taken back by lenders this year, but that forecast may have to change if the pace of repossessions doesn't pick up in coming months.

Lenders foreclosed on 215,046 properties during the quarter, between 60,000 and 90,000 short of the pace needed to achieve RealtyTrac's full-year forecast.

Sharga expects that backed-up court calendars and the backlog of foreclosures lenders are working to process will continue to slow foreclosure activity overall for at least another quarter.

That may provide some relief to the real estate market by limiting the number of new foreclosed homes being put up for sale. Foreclosures often sell at a steep discount, which can contribute to bring down the value of nearby homes.

In all, some 681,153 homes received a foreclosure-related notice in the first quarter, down 15 percent from the fourth quarter and down 27 percent from a year earlier. That translates to one in every 191 U.S. households, RealtyTrac said.

The firm tracks notices for defaults, scheduled home auctions and home repossessions — warnings that can lead up to a home eventually being lost to foreclosure.

At a state level, Nevada registered the highest foreclosure rate in the nation, with one in every 35 households receiving a foreclosure notice in the first quarter.

Arizona posted the second-highest foreclosure rate, thanks in part to a 26 percent spike in home repossessions. While California ranked third, with one in every 80 households receiving a foreclosure notice during the quarter.

Declines in foreclosure activity in states like Florida helped boost Utah to the No. 4 spot, followed by Idaho.

Rounding out the top 10 states with the highest foreclosure rate in the first quarter were: Georgia, Michigan, Florida, Colorado and Illinois.

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  • WooHoo2You Apr 14, 2011

    Oh really, "redapace"? How is America on the heal when we're headed towards $7 trillion further in debt because of your "healer" (Obama)? You are sadly mistaken. America won't heal by following a socialist mentality, although you may be totally ok with the government telling you how much money you can keep, what you can eat, what to wear.-lovethesouth1

    Next thing you know the government will be telling you how many days the Earth was created in, who you can marry, where you can build a place of worship, who is ‘an enemy of the people,” etc.

    BTW, BOTH parties tell you “how much money you can keep” they just choose different victims to tax…

  • lovethesouth1 Apr 14, 2011

    Oh really, "redapace"? How is America on the heal when we're headed towards $7 trillion further in debt because of your "healer" (Obama)? You are sadly mistaken. America won't heal by following a socialist mentality, although you may be totally ok with the government telling you how much money you can keep, what you can eat, what to wear.

  • drjones74 Apr 14, 2011

    Foreclosures are slowing down because the banks now own everything. Well, they always did with 30 year mortgages being the norm. The debtor is slave to the lender. Save your money. Produce your own food. Live close to your job. Never again use a credit card. These things will save us. Not listening to Glenn Beck.

  • redapace Apr 14, 2011

    The Bush recession was a doozie but America is slowly on the heal. By 2012 the country will be ready to flush the new rookie tea bag congress members out and we can get back on the road to real progress.

  • Rebelyell55 Apr 14, 2011

    LOL, a drop, but only until they can get the paper work done. Then the big boom!!

  • Raleigh Boys Apr 14, 2011

    Dear class, we get up and down news every day. A brilliant smoke screen to confuse the masses. One day the economy is up, next day it is down. One day unemployment went down, next day POOF it is back up. Same with the housing market. Wheels on the bus go round and round, round and round, all day long. Meanwhile kiddies, we are close to a financial collapse, hyper inflation, and $20.00 a gallon for gasoline.

  • Alex25 Apr 14, 2011

    Get the Govt OUT of the housing and loan biz....TODAY!!

  • WooHoo2You Apr 14, 2011

    Must find way to make good news sound bad! I call myself a patriot however hope deep inside the country will fall because then I will have been right all alone and that is all that really matters!!!

  • gswalker51 Apr 14, 2011

    Look at it this way folks...at a certain point, everyone who was going to lose their job has already lost their job. Everyone who was in danger of losing their house has lost their house. Writers who keep trying to spin this economy remind me of an overly optimistic airline pilot..."Ladies and gentleman, the bad news is we have crashed. But, the good news is we are no longer losing altitude."

  • 1 of the original Americans Apr 14, 2011

    I guess I will wait a little while to buy a great home for a cheap price

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