Foreclosures through the roof in '08

The number of properties facing foreclosure proceedings jumped 81% and the number of American households losing their homes through foreclosure surged 66% in 2008, according to two studies. A report released by RealtyTrac Inc. of Irvine, Calif., shows 2.3 million properties received at least one foreclosure filing, which include default notices, auction sale letters and bank repossessions, in 2008, up 81% from 2007 and up 225% from 2006. This equates to about one in every 54 homes receiving at least one foreclosure notice. In December alone, 303,410 properties received foreclosure notices, up 17% from November and up 41% from a year earlier, the RealtyTrac study said. The number of homeowners actually losing their homes through foreclosure in 2008 soared to 992,570, up 66% from 2007, according to a different study released by Foreclosures.com of Sacramento, Calif. California topped the list of states with the largest number of foreclosed homes at 260,709 in 2008. This was followed by Florida and Texas, the Foreclosures.com report said. On a per capita household basis, Nevada topped the list, with about one out of every 20 households losing their homes in foreclosure. This was followed by Arizona, where one in every 29 households went into foreclosure, and Mississippi and Georgia, where about one in every 39 homes were repossessed. In California, one in every 44 households faced foreclosure. When it comes to foreclosure notices and filings, Nevada again topped the list, with one in every 14 homes receiving a default notice, auction sale letter or bank repossession in 2008, according to RealtyTrac. But despite these grim statistics there is reason to believe that the worst is behind us, according to Alexis McGee, president of Foreclosures.com. “A variety of indicators show that some housing markets are bouncing back and we should see substantial improvement in 2009,” she said in a statement. Ms. McGee noted that housing affordability hasn’t been this good since February 1994 and falling mortgage rates make home buying attractive. The resetting of adjustable rate mortgages should not trigger another tidal wave of foreclosures in 2009 because “current mortgage rates are at 30-year lows and dropping,” she said. “Unemployment, while rising sharply, is still below where it stood in the 1990-91 recession and well below the highs of the early 1990s,” Ms. McGee said in the statement. The slight slowdown in foreclosure activity reported in November appeared to end in December. A number of states, such as Massachusetts, California, Colorado, Maryland, New York and North Carolina, have passed legislation that required waiting periods of up to 90 days before a lender can foreclose on a property. But this simply slowed, rather than stopped, the foreclosures in many cases. “Clearly the foreclosure-prevention programs implemented to date have not had any real success in slowing down this foreclosure tsunami,” James Saccacio, chief executive of RealtyTrac, said in a statement. The state legislation “appears to have done little more than delay the inevitable foreclosure proceedings for thousands of homeowners.”