Foreclosures Post Biggest Drop on Record

The number of foreclosure notices filed in February declined 14 percent compared with last month, and foreclosure notices dropped 27 percent compared to last year at this time. That marks the largest year-over-year decline that RealtyTrac, a foreclosure tracking site, has ever recorded. The number of U.S. homes in some stage of foreclosure fell drastically last month, reaching a 36-month low, RealtyTrac reports. Initial default notices, scheduled foreclosure auctions, and homes repossessed by lenders all dropped in February, RealtyTrac says. "Allegations of improper foreclosure processing continued to dog the mortgage servicing industry and disrupt court dockets," says RealtyTrac CEO James Saccacio. "The industry is in the midst of a major overhaul that has severely restricted its capacity to process foreclosures. Lenders repossessed 64,643 homes in February, a 17 percent drop from January. Initial default notices dropped 16 percent from January — and 41 percent from a year ago. What’s more, foreclosure auctions dropped 10 percent from last month and 21 percent from February of last year, RealtyTrac said. Rick Sharga, a senior vice president at RealtyTrac, says the real estate market isn’t out of the clear quite yet. He expects foreclosure activity to likely spike again as banks resolve foreclosure paperwork issues. About 2 million households are in foreclosure proceedings. In addition, about 5 million borrowers are at least two months behind on their mortgage payments. States With the Highest Foreclosure Rates The states with the highest foreclosure rates for the month: 1. Nevada (which has held the No. 1 spot for 50 consecutive months, with one in every 119 households receiving a foreclosure notice) 2. Arizona (one in 222) 3. California (one in 239) 4. Utah 5. Idaho 6. Georgia 7. Michigan 8. Florida 9. Colorado 10. Hawaii Source: “Foreclosures Plunge 27%-Biggest Drop on Record,” CNNMoney.com (March 10, 2011) and“Foreclosure Activity Slows Sharply in February,” Associated Press (March 10, 2011)