Housing market: Foreclosures rise in August

ScottR · Chief Bottle Washer Joined: Feb 11, 2006 Posts: 332

Foreclosure filings rose in August, as more homebuyers fell behind on their mortgage payments.

Filings were up 7% compared to July, but were still 33% lower than they were a year ago -- marking the eleventh straight month of year-over-year declines, according to RealtyTrac, a leading online marketer of foreclosed properties.

According to the report, 228,098 homes in the U.S. received some kind of foreclosure filing in August. Default notices, which typically initiate the foreclosure process, surged more 33% from July. Foreclosure auctions and bank repossessions, which come later in the process, both fell slightly.

The increase in default notices may signal that lenders are starting to finally push through foreclosure paperwork that was previously delayed by the "robo-signing" controversy last fall, said RealtyTrac CEO James Saccacio.

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

The good news is that bank repossessions have been falling. Lenders repossessed 64,813 homes in August, a six-month low and a 37% decline after bank repossessions hit a peak in September last year.