Foreclosure Filings nationwide have dropped to their lowest level since July 2007. Are we in the eye of the storm or is the worse behind us? That is the million dollar question I will attempt to answer.
To begin, national overall foreclosure filings dropped 5% from March and are down 14% from a year ago, according to www.Foreclosures.com internal research.
What’s interesting is the biggest foreclosure filing decreases came from the three states that have been hit the hardest to date – Nevada, Arizona, California.
Although overall foreclosure filings are down nationwide, they are up in more than half of states.
Once a property has gone through the pre-foreclosure process and finally goes up for public sale, if there are no outside bidders the property is reverted to the lender and becomes a bank owned (REO) foreclosure. Each step of the way there are foreclosure filings, which we track and publish on foreclosures.com for our members.
Your best leading indicator of what’s to come in the foreclosure market is the first notice of foreclosure (pre-foreclosures or notice of defaults). And after three straight monthly increases pre foreclosure filings have dropped 4% from March and are now down 2% from April 2011.
However, 26 states posted monthly increases in pre foreclosure filings and 27 states posted year-over-year increases.
Top 3 Pre Foreclosure Filing States
Nevada: 15% increase in pre foreclosure filings pushed it to the highest state foreclosure rate.
California: Even with a 30% drop in pre foreclosure filings, the state still posted the nation’s second highest foreclosure rate.
Florida: Pre Foreclosure filings rose 26%, bringing the state’s foreclosure rate to third highest.
Other states with pre foreclosure filings ranking among the top were Illinois, Utah, Michigan, Ohio, and Wisconsin.
Looking at the “end of the tunnel” bank (REO) foreclosure filings for April have decreased for the third straight month, down 7% from March and down 26% from April 2011. This marks the 18th month with a year-over-year decrease in REOs.
REO foreclosure filings dropped in 37 states, however 11 of the nation’s 20 largest metro areas had annual increases in foreclosure filings – with Riverside-San Bernardino, Miami, Atlanta, Phoenix, and Tampa having the highest REO foreclosure filings.
What do These Numbers Mean to You?
Although overall foreclosure filings are down, when you look more closely you will see we are not out of the woods yet. You cannot average the “overall” numbers and make an educated conclusion Just look at how the big 3 states (that have had a drop in notices) have erased the gains of over half the states across the country. That does not tell an accurate story.
Nor can you make the conclusion that even if California, Nevada and Arizona foreclosure filings are down right now, does not mean they will stay at these low levels. We have a lot of pressure currently from our federal government with the banks to work out a loan modification or short sale with the current owners. These programs will save some homes. But they will not save them all. Nor in an election year can you ascertain that current government policies will stay in place.
Eventually, these properties will be included in our foreclosure filing statistics. The question is, how soon will we see them?
Right now, they are the hidden “shadow or phantom” foreclosures that no one is talking about – no one but me of course. Can’t wait to share those details and more on foreclosure filings, past, present and future in my New, Live, Foreclosure Investor Webinar. Hope to see you there.
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