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Foreclosure Inventory Could Bloat

Foreclosure

While there hasn’t been any increase in the volume of foreclosures completed during the past couple months, the sale of real estate owned has slowed — placing pressure on the foreclosure inventory. California, the state with the most repossessions, is home to three of the country’s worst major areas.

Mortgage servicers completed 60,000 U.S. foreclosures during June. That was the same number as in the previous month and brought the trailing 12-month total to 793,663 mortgages converted to REO status.

Finalized foreclosures fell, however, from June 2011 when foreclosures were completed on 80,000 mortgage loans.

From Jan. 1 through June 30, repossessions totaled 388,000, according to current and prior data reported in CoreLogic Inc.’s National Foreclosure Report. Since the financial crisis began in September 2008, servicers have completed 3.7 million foreclosures.

Competing data from RealtyTrac indicates that 54,272 U.S. foreclosures were completed in June, while the year-to-date June 30 total was 339,871.

During the last 12 months, CoreLogic reported California had the most completed foreclosures: 124,626. Three of the 10-worst core-based statistical areas were in California.

Florida followed with 90,961, then Michigan’s 57,980 and Texas’ 56,131. 

Behind Georgia’s No 5 standing with 54,600 foreclosures completed was the Atlanta CBSA’s 37,165 foreclosures — more than any other large area of the country.

South Dakota had just 39 completed foreclosures in the 12 months ended June 30, the fewest of any state.

Around 1.4 million properties were in the foreclosure inventory as of the end of June, the same as a month earlier but less than at the same point last year, when 1.5 million mortgages were in the process of foreclosure.

That put the foreclosure inventory rate at 3.4 percent, a little lower than 3.5 percent in June 2011.

CoreLogic Chief Economist Mark Fleming noted that while the number of completed foreclosures has been static the past two months, REO sales have slowed. The disparity points to a rising foreclosure inventory.

With an 11.5 percent foreclosure inventory rate, Florida’s rate was worst. New Jersey was No. 2 with a 6.5 percent rate. After that was 5.1 percent in New York, 5.0 percent in Illinois and 4.8 percent in Nevada.

The four states with the highest rates were all judicial-foreclosure states.

Wyoming’s 0.6 percent foreclosure inventory rate was lowest. Wyoming is a non-judicial foreclosure state.

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