Default notices up 33 percent in August

Sept. 15, 2011 at 9:20 AM
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IRVINE, Calif., Sept. 15 (UPI) -- U.S. foreclosure activity and default notices both rose in August, with defaults climbing 33 percent, a private real estate firm said Thursday.

RealtyTrac, an online marketplace for foreclosed properties, said foreclosure activity rose 7 percent compared to July with foreclosures affecting one out of every 570 housing units in the United States.

Foreclosure activity, which includes default notices, scheduled auctions and bank repossessions, are down 33 percent from August 2010, involving 228,098 housing units in the month.

Default notices, however, rose more than 40 percent in three states. In New Jersey, default notices rose 42 percent; Indiana, 46 percent, and California, 55 percent.

In Nevada, one out of every 118 housing units was involved in foreclosure in August, RealtyTrac said -- the highest ratio in the country. Coming in second was California where one out of every 226 housing units was involved in foreclosure. Arizona posted the third highest ratio, with one out of every 248 housing units involved some stage of foreclosure in the state in August.

"The big increase in new foreclosure actions may be a signal that lenders are starting to push through some of the foreclosures delayed by robo-signing and other documentation problems," said James Saccacio, chief executive officer of RealtyTrac.

"It also foreshadows more bank repossessions in the coming months as these new foreclosures make their way  through the process," he said.

Several major U.S. lenders suspended foreclosure activities after a paperwork processing scandal surfaced in the summer of 2010. Banks were accused of taking short cuts on paperwork that short-changed homeowner's rights to due process.

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