A new report from RealtyTrac suggests that around one million foreclosure notices expected to be filed by mortgage lenders in 2011 will be delayed until the following year – a boon for homeowners who will gain extra time to catch up with their mortgage repayments and avoid losing their homes.
However, it might not be good news for everyone, with industry observers warning that real estate markets across the nation could be plagued by this looming shadow of foreclosure delays for much longer than previously expected.
As RealtyTrac’s vice president Rick Sharga explains, “It’s looking like the best-case scenario will be that we reach normal foreclosure levels sometime around 2015, so that means any recovery is set to be delayed for at least one more year than forecast.”
The number of repossessions by mortgage lenders this year (from Jan. to June) has decreased by around 30% compared to the previous year, the report explains. However, delays with foreclosure processing (lenders are taking far longer to foreclose on delinquent borrowers) are also put a skid on any housing recovery, say observers.
In the first six months of 2011, there were around 1.2 million foreclosure notices served – which amounts to a rather mind-boggling one out of every 111 homes in the US being served a notice.
RealtyTrac also reported that Nevada continues to be the worst affected state, with one out of every 21 homes moving into the foreclosure process.
The average length of time for foreclosures to process has also increased, says RealtyTrac. Figures from the second quarter show that the average home going through foreclosure tool 318 days to be repossessed, from the day the notice was first served. This is a 20 day increase on the first quarter’s average of 298 days.
The state of Texas currently has the shortest foreclosure periods, with the process averaging just 92 days, while New York has by far the longest process, at 966 days.