Despite foreclosure moratoria holding steady in several states, a recent foreclosure report from ATTOM Data Solutions revealed a total of 6,042 U.S properties began the foreclosure process in October. That number is up 21% from a month ago, but still down 79% from this same time last year.
However, some individual states did see that number climb year-over-year including Idaho, which was up 109%, and Nebraska, up 56%, since last October.
As for foreclosure filings – including default notices, scheduled auctions or bank repossessions – approximately 11,673 U.S properties filed in October. That number is up 20% from a month ago, but still down 79% from this same time last year.
According to the report, states with the highest foreclosure rates were South Carolina, Nebraska, Alabama, Louisiana and Florida. Some metros in particular were worse off than others, including Peoria, Illinois, where one in every 1,543 housing units was in a foreclosure filing. In Beaumont, Texas, that number was one in every 1,880, and in Birmingham, Alabama, one in every 1,993.
“It’s a little surprising to see foreclosure activity increasing in spite of the various foreclosure moratoria that are in place,” said Rick Sharga, executive vice president of RealtyTrac, an ATTOM Data Solutions company. “It’s likely that many of these properties were already in the early stages of default prior to the pandemic, or are vacant and abandoned, which makes them candidates for expedited foreclosure actions.”
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Bank repossessions on REO homes (real-estate owned) were also up 28% from last month for a total of 2,577 U.S properties. Again, the number is down year-over-year 81%.
Sharga noted it’s important to keep the numbers in context – even with these increases, overall foreclosure actions are still below last year’s levels by about 80%.
But those numbers may be heavily influenced by moratoria led by government entities. According to Black Knight’s Mortgage Monitor Report for September, widespread foreclosure moratoria have kept borrowers who might otherwise face foreclosure proceedings in a 90-day delinquency status. The report also revealed more than 2.3M homeowners – five times the number entering 2020 – remain 90 or more days past due, but not in foreclosure.
On Aug. 27, in a bid for continued stability, the Federal Housing Finance Agency extended its moratorium on foreclosures and evictions for borrowers with mortgages backed by Fannie Mae and Freddie Mac until Dec. 31. That same day, the Federal Housing Agency also extended its moratorium to Dec. 31.
Though there has been no word on whether another extension will arrive in 2021, the FHFA did say it would continue to monitor the COVID-19 pandemic and “update policies as needed.”