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August Foreclosures Up 18 Percent Over 2008

Most activity still centered in a few states

September 10, 2009

The latest monthly report from RealtyTrac, a foreclosure tracking firm, shows foreclosure filings - default notices, scheduled auctions and bank repossessions - were reported on 358,471 U.S. properties during the month, a decrease of less than 1 percent from the previous month but still an increase of nearly 18 percent from August 2008. The report also shows one in every 357 U.S. housing units received a foreclosure filing in August.

"The August report demonstrates that there is still an ample supply of properties filling the foreclosure pipeline even while the outflow of bank-owned REO properties onto the resale market is being more carefully regulated," said James J. Saccacio, chief executive officer of RealtyTrac. "After hitting a high for the year in July, REOs dropped 13 percent in August, but we also saw a record high number of properties either entering default or being scheduled for a public foreclosure auction for the first time."

Complaints received by ConsumerAffairs.com in recent months show a high level of frustration by homeowners who are trying to modify their loans to prevent becoming a foreclosure statistic.

"I called Litton for help to modify my loan back in December 2008. I spent all my time calling them trying to get someone who can help me, but each time I kept getting different answers," Rosa, of Freeport, NY, told ConsumerAffairs.com. I gave them all the information to apply for a modification and it was not approved. I got a letter in the mail stating that it was declined by the investor."

Nevada, Florida, California post top state foreclosure rates

With one in every 62 housing units receiving a foreclosure filing in August, Nevada continued to document the nation's highest state foreclosure rate despite an 8 percent decrease in foreclosure activity from the previous month. A total of 17,902 Nevada properties received a foreclosure filing during the month, still an increase of 53 percent from August 2008.

Florida documented the nation's second highest state foreclosure rate, with one in every 140 housing units receiving a foreclosure filing, and California documented the nation's third highest state foreclosure rate, with one in every 144 housing units receiving a foreclosure filing.

A 10 percent month-to-month decrease in foreclosure activity helped lower Arizona's foreclosure rate from the nation's third highest in July to fourth highest in August. One in every 150 Arizona housing units received a foreclosure filing in August - still more than twice the national average.

Other states with foreclosure rates ranking among the nation's 10 highest were Michigan, Idaho, Utah, Colorado, Georgia and Illinois.

Six states account for more than 60 percent of national total

Six states accounted for 62 percent of the nation's total foreclosure activity in August despite decreasing REOs in all six states. California REOs dropped 32 percent from the previous month, but the state continued to post the highest overall total of any state, with 92,326 properties receiving a foreclosure filing in August. California's total was down 15 percent from the previous month and was also down nine percent from August 2009 - the first year-over-year decrease in California foreclosure activity in RealtyTrac's monthly reports.

A total of 62,401 Florida properties received foreclosure filings in August, the nation's second highest state total and an increase of more than 10 percent from the previous month despite a 5 percent decrease in REO filings. Initial default notices in Florida increased 12 percent from the previous month, and scheduled auctions increased 13 percent from the previous month.

A new law in Michigan requiring lenders to file a separate public notice of default before scheduling a foreclosure auction boosted overall foreclosure activity numbers in the state for August. A total of 9,789 of the new default notices were reported in August, bringing the total number of Michigan properties receiving foreclosure filings to 19,359 for the month - a 134 percent spike from the previous month and third highest among the states. Michigan's foreclosure rate leapfrogged from 19th highest in July to fifth highest in August.

With 17,902 properties receiving foreclosure filings in August, Nevada posted the nation's fourth highest total despite a 24 percent decrease in REO filings from the previous month, and with 17,807 properties receiving foreclosure filings in August, Arizona posted the nation's fifth highest total despite an 11 percent decrease in REO filings from the previous month.

Illinois REO filings decreased 15 percent from the previous month, but the state's total of 13,078 properties receiving foreclosure filings was still sixth highest among all the states in August.

Other states with totals among the 10 highest in the country were Georgia (11,947), Ohio (11,368), Texas (11,261) and New Jersey (8,316).

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