The Week Ahead – Will Foreclosures Take Another Dive?

The national foreclosure rate in July was back to where it was in August 2007‒‒a little less than 1 percent overall, according to a new report from CoreLogic. Moreover, foreclosures were down in July, compared to June and to a year earlier, in every state except North Dakota.

In June, the national foreclosure rate was 1.3 percent. By July, CoreLogic reported, that number had shrunk to 0.9 percent. Compared to July 2015, foreclosures are down almost 30 percent, from a total 501,000 homes to 355,000.

There were 34,000 foreclosures in July. That’s down from 41,000 a year ago, about 16.5 percent, and 4 percent down from June.

CoreLogic president and CEO Anand Nallathambi said the foreclosure rate was down everywhere but North Dakota, which saw a 6-percent uptick. Nallathambi attributed the rise in foreclosures with the state’s sharp drop in energy-related jobs.

Back east, the drop in foreclosures is slow, but successful. “Judicial states like New Jersey and New York have continued to work through their large inventory of homes in foreclosure proceedings,” he said.

Along with the overall drop in foreclosures nationally, the number of homes in serious stages of delinquency was also down. Compared to June, there was a miniscule drop, from 1,156 to 1,150 homes in advanced delinquency. But compared to a year ago, the number of these properties is down 3 percent.

“Loan modifications, foreclosures, and strong housing and labor markets have each played a role in bringing the foreclosure rate to the lowest level in nine years,” said CoreLogic chief economist Frank Nothaft.

Will August’s foreclosure and delinquency rate take another dive down across the board as loan modifications increase?

The upcoming CoreLogic Foreclosure Report will be released Tuesday, October 11th.

Tuesday, October 11—Quicken Loans Home Price Perception Index, September 2016

In August, residential home appraisals were an average of 1.56 percent lower than what refinancing homeowners expected while home values spiked by more than 8 percent from the previous August.

“While a one and a half percent difference may not seem like a big disparity of home value opinions, the gap could cause problems, especially in areas with an even wider difference,” said Quicken Loans Chief Economist Bob Walters. “In some portions of the Midwest, where appraisals are averaging 2-3 percent less than what was expected, this will often lead to restructuring a refinance or the homeowner needing to bring a few more thousand dollars to the closing table.”

By Kendall Baer for DS NEWs


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