Foreclosures Fall, Starts Pick up in a Few States

The Coronavirus-related moratorium has resulted in mortgage foreclosure activity posting an 83% deficit over its performance a year ago, says Attom Data Solutions. Compared to June, the numbers reveal a 4% decline. Over the first 6 months of the current year, the mortgage foreclosure activity has been 44% lesser than the same time last year. Compared to the same duration in 2018, the fall is 54%.

In numbers, what this says is that one out of every 15,337 properties in America has filed for foreclosure in 2020. This number was one in every 2,652 in 2019. 

Rick Sharga, executive vice president at RealtyTrac, feels that normalcy may return once the moratoriums are taken off. 

“It’s inevitable that there will be a significant increase in foreclosures once these moratoria have expired, although it’s unlikely that we’ll see default rates reach the levels we saw during the Great Recession,” Sharga stated.

Statewise, Delaware’s foreclosure rates topped the table, with one in every 6,489 properties going that way. South Carolina and Maine were close at Delaware’s heels.

For areas with a population in surplus of a million, Louisville (Kentucky), Riverside (California), and Baltimore (Maryland) stood at the first three positions. 

Sharga believes that “Even after default activity starts to increase, we may not see a similar increase in the number of repossessions,” Sharga said. “The combination of record levels of homeowner equity, extremely limited supply of homes for sale, and strong homebuyer demand should give many distressed homeowners an opportunity to sell their property rather than lose it to foreclosure.”

Connecticut (54% higher foreclosure starts on the month-to-month chart), Michigan (42%), Missouri (34%), Virginia (32%), and California (1%) are, however, trading against the wind.

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