The national average for the amount of time it takes to move a property through the foreclosure process is 382 days. The process has been getting lengthier over the years. It averaged 336 days in the third quarter of last year, and in the third quarter of 2007, it averaged just 140 days.
Backlogs in some states are even worse, taking years to complete and prolonging a housing recovery in these areas.
For example, New York has the worst foreclosure backlogs in the U.S., where the average foreclosure takes nearly three years to process â€” or 1,072 days. In New Jersey, the process takes an average of 931 days, according to RealtyTrac data. In Florida, it takes about 858 days.
Due to the huge foreclosure backlogs in some areas, some economists say it could be 2015 until foreclosure inventories begin to shrink to more normal levels.
Foreclosures usually take the longest to process in states where foreclosures have to go through the courts to get approval.
â€œEven if youâ€™re not in foreclosure, if you live in a state where processing times are long, that could eventually end up affecting you when youâ€™re in the market for a new mortgage,â€ MarketWatch reports. â€œHigh foreclosure inventory volume also affects home prices.â€
Indeed, home prices are rising the fastest in places where the foreclosure process isnâ€™t so backlogged, according to RealtyTrac. For example, Arizona is seeing big price growth, and foreclosures in that state take just 194 days to be completed. In Phoenix, prices rose 20.4 percent in September year-over-year, according to some indexes.
Source: â€œHow Foreclosure Backlogs Could Hurt Home Buyers,â€ MarketWatch (Dec. 3, 2012)