Weather, Mortgage Redos Slow Foreclosure Filings in February

U.S. foreclosure filings declined by 2 percent in February at 308,524 properties compared to the previous month, and up 6 percent from a year ago – the smallest annual increase in four years, according to RealtyTrac’s latest monthly update.

One in every 418 U.S. households received a foreclosure filing in February, including default notices, scheduled auctions and bank repossessions, reported the online foreclosure resource.

Even though it was the smallest jump in four years, “it still marked the 50th consecutive month of year-over-year increases in foreclosure activity,” said James J. Saccacio, chief executive officer of RealtyTrac.

Additionally, severe winter weather may have temporarily slowed the processing of foreclosure records in some Northeastern and Mid-Atlantic states, he said.

The slightly reduced pace is primarily from delays in filings caused by foreclosure prevention programs, including the government’s Home Affordable Modification Program, HAMP, Saccacio said.  The program is marked by months-long trial periods with reduced monthly payments before a borrower is approved for permanent mortgage reduction.

But HAMP is only seeing slightly more than a quarter of borrowers in trial modifications progress to permanent relief as of January’s report.

“This leveling of the foreclosure trend is not necessarily evidence that fewer homeowners are in distress and at risk for foreclosure, but rather that foreclosure prevention programs, legislation and other processing delays are in effect capping monthly foreclosure activity — albeit at a historically high level that will likely continue for an extended period,” he said.

Nevada’s foreclosure filings decreased nearly 7 percent from the previous month and down 30 percent from a year ago, but the state ranked first in the nation for the 38th month in a row. One in every 102 Nevada housing units received a foreclosure — more than four times the national average.

Behind Nevada, Arizona and Florida had early identical foreclosure rates, with one in every 163 households getting a foreclosure filing in both states.

Despite a nearly 21 percent decrease in foreclosure activity from the previous month, Arizona’s rate was slightly higher than Florida’s, placing it second highest among the states.

California’s foreclosure rate ranked fourth highest, with one in every 195 homes receiving a foreclosure filing during February.

The six states with the most foreclosure activity accounted for 61 percent of the national total in February. Completing the top six were Michigan and Utah.