Foreclosures Down, But Economists Still Dour

Bank foreclosures
Bank foreclosures

Fewer people are getting bad news in the mailbox: the number of foreclosure fillings dropped again in January, according to the latest information from RealtyTrac.

There were 315,716 foreclosure filings in January -- that's down 10 percent from December. Cheery news, at first glance. But more than 300,000 foreclosure filings in a single month is still tremendously bad. In Jan. 2008, before the full brunt of the crisis struck, the rate was just over 200,000 foreclosure actions a month. But that rate was enough to set into motion the chaos in the nation's bond markets that later spread to the rest of the financial system.

There have been well over 300,000 foreclosure filings a month for the last 11 months. Worse, a growing number of experts and economists seem to expect a new wave of foreclosure filings in 2010. That's includes the boss at RealtyTrac.

"If history repeats itself we will see a surge in the numbers over the next few months as lenders foreclose on delinquent loans where neither the existing loan modification programs or the new short sale and deed-in-lieu of foreclosure alternatives works," said James J. Saccacio, chief executive officer of RealtyTrac.