About 123,040 homes were repossessed by mortgage lenders in the third quarter – a decrease of 1% compared with the second quarter but an increase of 66% from the third quarter of 2014, according to RealtyTrac.
It was the largest year-over-year increase in bank repossessions since RealtyTrac began tracking foreclosure activity in 2008.
Meanwhile, foreclosure starts continued to fall precipitously. A total of 133,811 homes started the foreclosure process in the third quarter – down 12% from the second quarter and down 14% from the third quarter of 2014 to reach the lowest level since the third quarter of 2005.
Looking at all foreclosure activity, including default notices, scheduled auctions and bank repossessions, a total of 327,258 U.S. properties saw foreclosure filings in the third quarter – down 5% from the first quarter but up 3% from the third quarter of 2014.
‘The widespread rise in foreclosure activity in the third quarter compared to a year ago is the result of two starkly different trends taking place,’ explains Daren Blomquist, vice president of RealtyTrac, in a release. ‘In states such as New Jersey, Massachusetts and New York, a flood of deferred distress from the last housing crisis is finally spilling over the legislative and legal dams that have held back some foreclosure activity for years.
‘That deferred distress often represents properties with deferred maintenance that will sell at more deeply discounted prices, creating a drag on overall home values,’ Blomquist says. ‘On the other hand, in states such as Texas, Michigan and Washington, the third-quarter increases are a sign that the foreclosure market has settled into a normalized pattern close to or even below pre-crisis levels, and in those states, the overall housing market should easily absorb the additional foreclosure activity with little impact on home values.’
Looking just at September, a total of 109,130 U.S. properties had foreclosure filings during the month – down less than 1% from August but up 2% from September 2014.
About 43,358 properties started the foreclosure process in September – the lowest level since November 2005, RealtyTrac reports.
States bucking the national trend with the biggest increase in foreclosure starts in September compared with a year ago included Louisiana (up 468%), Missouri (up 131%), Virginia (up 70%), Massachusetts (up 60%) and Texas (up 21%).
Lenders repossessed a total of 40,308 properties in September – up 10% from August and up 76% from September 2014. Bank repossessions increased year over year for the seventh consecutive month in September.
States with the biggest increase in real estate owned properties in September compared with a year ago included Nevada (up 844%), New York (up 580%), New Jersey (up 401%), Georgia (up 186%) and North Carolina (up 183%).
For more, including a breakdown of foreclosure activity in individual states, click here.