The 5 major lenders report their 2012 pre-foreclosure rate
has dropped a whopping 41%! The Big Five
looked at their combined notice of default, (NOD) and notices of trustee sales,
(NTS) and compared them to that of a year ago according to Reality Track.
Bank of America reports a 63% reduction from last year. Citi is showing a 40% reduction from last
year’s totals. However, when comparing
the numbers of pre-foreclosure filings in judicial states vs. non-judicial
states there seems to be an increase.
Collectively, Bank of America, Citi, Wells Fargo, JP Morgan Chase, and
Ally are showing a 26% increase in pre-foreclosures in judicial states. Even US Bank showed an 11% increase of
repossessions from October to November and a 5% growth in Foreclosure activity
from 2011. Why is that?
Real estate analysts believe that judicial states are
hindering the process of clearing distressed properties due to their regulations
put in place which also result in enormous back logs. Illinois happens to be one of those judicial
states and this process can take up to 2 years.
Chase and Wells Fargo were the two lenders affected most by
the judicial process, showing an increase of lis pendens and notice of
foreclosures of 37% - 114%. This is despite
the 3% reduction of foreclosure filings across the country in October and
November and a 19% drop from last year, according to Realty Trac. They report that this is 26th
consecutive month where an annual drop in foreclosure activity and showing only
180,817 properties in some form of foreclosure process.
That still may sound like a large a number but according to
Daren Bloomquist, VP of Realty Trac says, “The drop in overall foreclosure activity in
November was caused largely by a 71-month low in foreclosure starts for the
month, more evidence that we are past the worst of the foreclosure problem
brought about by the housing bubble bursting six years ago,” but, “We’re likely
not completely out of the woods when it comes to foreclosure starts, either, as
lenders are still adjusting to new foreclosure ground rules set forth in the
National Mortgage Settlement along with various state laws and court rulings.”
enough, although pre-foreclosures may be dropping, in judicial states like
Illinois, foreclosure auction activity is at all-time high, especially in the
last 90 days,” says Benjamin De Los Monteros of Chicago based, Cherry Picker