Daily Real Estate News | July 14, 2011 |
1 Million Foreclosures Delayed Until 2012
An estimated 1 million foreclosure-related notices
for defaults, auctions, and home repossessions that should be filed by lenders
this year will be pushed back until next year, according to the latest report by
While the delays could give
home owners more time to catch up on their payments and try to avoid
foreclosure, housing experts warn this means the looming shadow inventory of
distressed properties likely will continue to plague the real estate market even
“The best-case scenario is we
don’t get back to normal levels of foreclosure activity until 2015, which means
the housing market recovery gets delayed by at least a year,” says Rick Sharga,
a senior vice president at RealtyTrac.
Foreclosure Notices Drop, Threat Still Looms
Overall, the number of homes repossessed by lenders in the
first half of this year dropped 30 percent compared to the same period in 2010.
But foreclosure processing delays — with lenders taking longer to
take action against delinquent borrowers
— is stalling the
housing recovery, experts note.
million homes received a foreclosure-related notice in the first six months of
this year —
in other words, one in every 111 U.S. households,
Nevada continues to
face the most foreclosures; one in every 21 households in that state received a
foreclosure notice in the first half of the year.
The foreclosure process continues to lengthen too. From April and
June, homes took 318 days on average to go from the first stage of foreclosure
to ultimately where it was repossessed by the lender — that’s up from 298 days in the first three months of the year. (In
New York, the foreclosure process took the longest at an average of 966 days or
2.6 years; Texas boasted the shortest at 92 days.)
Source: “Delays in Bank Processing Push Likely
U.S. Foreclosures Until 2012, Stalling Recovery,” Associated Press (July 14, 2011)
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