There’s still some way to go but all the signs are that the foreclosure crisis is finally coming to an end. Latest figures from RealtyTrac show that foreclosure filings have continued their downward trend, falling to the lowest level since April 2007 at the end of last month.
Foreclosure filings – which encompass bank repossessions, default notices and scheduled auctions – fell by 28% last January compared to one year earlier, reports CNN Money.
Daren Blomquist, spokesperson for RealtyTrac, said that there was every reason to be optimistic:
“We’re now well past the peak of the foreclosure crisis. It's likely that by this time next year, we'll start to see 2005-type, pre-crisis numbers again.”
That might seem like a slightly optimistic prediction from Blomquist, considering that foreclosure levels remain twice as high as they were in 2005, but then again, the rate at which they are slowing down suggests he might not be too far off the mark. Already, bank repossessions have fallen to half of the record-breaking 102,134 set in September 2010, and things are only going to get better from here on in as banks race through their backlog of underwater homes.
One of the big reasons for the drop in foreclosures was due to new legislation in California, which gives borrowers more protection against losing their homes when they default on their repayments. As a result, California saw a 62% drop in foreclosure numbers in January, meaning that the state no longer leads the country in number of foreclosure filings, for the first time since 2007. Instead, that rather dubious honor now falls to Florida with 29,800 filings last month, followed by Nevada and Illinois.
Blomquist reminds us that the foreclosure crisis isn’t over yet – 26 states actually saw the number of foreclosure auctions rise - but things are definitely a lot better than they were just a couple of years ago.