Banks’ Repossessed Homes on the Rise With Foreclosure

By: Timothy McFarlin | Published: September 14th, 2010 | Category: Foreclosure Issues

According to an August Reuters report and RealtyTrac findings, in July, the banks repossessed just over 92,858 properties throughout the country—banks also recorded “the second highest monthly number of homes ever ” just in July alone.

The unsteady housing market saw all foreclosure activity, including repossession, rise 4%–from June to July.  According to the California-based real estate data collection company, RealtyTrac, actions were taken on over 325,000 properties, “with one in every 397 housing units getting a foreclosure filing.”

Unemployment, which still runs rampant throughout this country, is but one cause for high foreclosure rates and failure to make regularly scheduled payments, on a timely basis.

Rick Sharga, RealtyTrac’s Senior Vice President said during a recent interview, “What’s driving most of the foreclosure activity is unemployment and other types of economic displacement…Repossessions coupled with the fact that we’re still looking at 5 million seriously delinquent loans, many of which would normally already be in foreclosure, really suggests that what the banks are doing is managing inventory levels.”

How so many homeowners could fall behind on their mortgage payments, while receiving assistance from the government is a mystery and one the Obama administration may not be able to solve; yet, have recently acknowledged.  In fact, the Treasury Department has recently made alterations to its existing program to aid jobless homeowners and their families, avoid foreclosure.

RealtyTrac’s Sharga also noted, “We not only need unemployment to settle down, but we need job creation and consumer confidence improving, so that people that can buy will get back on market and start buying up the inventory of these assets.”

As has been the case for a while now it seems, California, Florida, Nevada and Arizona all had the highest state foreclosure rates; and for the 43rd month in a row, Nevada had the highest foreclosure rate of any state.  During these tough economic times, the one thing Nevada relies so heavily on—tourists and outsiders, is non-existent, consequently, forcing casinos and hotels to file for Chapter 11.  Then, when these businesses close, unemployment goes up and so on.

Over 97,100 homes received a default notice last month, which is 1% more than June, however, 28% less than July of last year and 32% lower than the record back in April ’09.  RealtyTrac found lenders set, for the first time, foreclosure auctions on 135,248 properties last month—which was, incidentally, a 2% increase from June, yet, down from a peak of 158,105 properties back in March.

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