Foreclosures Could Be on the Rise Again, Report Says


Foreclosure filings fell last month, but there are indications that they could soon rise again, a report by RealtyTrac says.

Foreclosure filings across the country dropped 3 percent from October 2011, and 14 percent from November 2010, according to the report. About 224,000 homes across the country received a default notice, were scheduled to be sold at a foreclosure auction or were repossessed by a lender. Banks foreclosed on fewer homes in November than at any time since March 2008, the report found.

But because the dip was the smallest annual decrease over the last year -- and some hard-hit states actually posted increases -- it could mean that the ebb in foreclosure activity, which has come during government action against lenders, is ending.

James Saccacio, co-founder of RealtyTrac, says the real estate market must still grapple with issues like the glut of foreclosed homes that banks are afraid to sell, ramped-up regulation of the foreclosure process and settlements over "robosigning," a term used to refer to the practice of filing shoddy foreclosure paperwork.

"All of those things need to clear in order for there to be clarity in the marketplace," Saccacio told AOL Real Estate, adding that, nonetheless, he "would expect you could see more activity" next year.

Saccacio also highlighted the 13 percent monthly increase in scheduled foreclosure auctions that was documented in the report. He attributed the increase to a wave of default notices that began in August.

For the 59th straight month, Nevada, ground zero of the housing crisis, posted the highest foreclosure rate in the country. One out of every 175 Nevada housing units was in a state of foreclosure, despite a bill passed in October that has made it harder for banks to process foreclosures in Nevada.

California came in second with one in every 211 properties being in some state of foreclosure, and Arizona third, with one in every 256. The report also found that a staggering nine out of 10 cities with the highest foreclosure rate are in California.