May turned out to be a busy month for foreclosure
activity. Foreclosure filings, which include default notices, scheduled
auctions, and bank repossessions, were up 9 % in May from the previous month of
April, but still down 4 % from a year ago, according to RealtyTracâ€™s U.S.
Foreclosure Market Report for May 2012.
Foreclosure filings were reported on 205,990
properties in May after two consecutive months below 200,000, but activity
levels were still down on a yearly basis for 20 consecutive months now. In
April, foreclosure filings totaled 188,780.
After three straight monthly decreases to a 49-month
low in April, bank repossessions (REOs) climbed 7 % month-over-month, but were
still down 18 % from May 2011. In May, lenders completed the foreclosure
process on 54,844 properties.
starts â€“ default notices or scheduled foreclosure
auctions, depending on the state â€“ were filed on 109,051 properties in May, a
12 percent monthly increase and a 16 % jump from a year ago. The annual
increase was a first after 27 consecutive months of yearly declines.
Based on the rise in pre-foreclosure sales seen so
far this year, a higher percentage of these new foreclosure starts will likely
end up as short sales or auction sales to third parties rather than bank repossessions
going forward. While pre-foreclosure sales have less of a negative impact on
home values than bank-owned sales, they still represent a discounted sale where
a distressed homeowner is losing his or her home.