Due to the repeated rate decreases recently noted in national mortgage records, a significant number of financially strained consumers may have been able to refinance existing residential loans and avoid foreclosure last month.
According to RealtyTrac's U.S. Foreclosure Market Report for April 2013, just 144,790 U.S. properties reported default notices, scheduled auctions and bank repossessions during the month. The latest figure marks a month-over-month decrease of 5 percent, and a difference of 23 percent from year-ago numbers. Overall, total foreclosure activity was recently recorded at its lowest level since February 2007, representing a 74-month low.
In addition, the report showed that just one in every 905 American households had a foreclosure filing last month. Daren Blomquist, vice president of RealtyTrac, said the numbers noted in April may indicate the nation's inventory of foreclosed houses is finally working through its backlog, although some states are showing increases.
"Foreclosure starts have been increasing for several months in many of the judicial states," said Blomquist. " Meanwhile, foreclosure starts are bouncing higher in a handful of non-judicial states where servicers are adjusting to legislation designed to prevent improper foreclosures. This includes Nevada, Washington and Arkansas, where foreclosure starts have been increasing on an annual basis since late 2012, along with Oregon and California, where foreclosure starts are still down from a year ago but have been moving steadily higher in recent months."
Blomquist also alluded to recent increases in scheduled foreclosure auctions within judicial states have been exhibited recently, ticking up to a 30-month high in April. This reportedly shows that many lenders may be more serious moving forward with completing the repossession process.
Drops observed in national mortgage loan delinquency rate
In addition to fewer foreclosures being recorded during April, the first quarter of 2013 saw a significant decline in mortgage delinquencies on both quarterly and yearly bases. TransUnion recently reported the national mortgage delinquency rate during the first three months of 2013 dropped 21 percent year-over-year, and currently stands at 4.56 percent. Quarter-over-quarter, the rate of borrowers who were 60 or more days past due decreased 12 percent.
"We are pleased to report that the national mortgage delinquency rate experienced its first major decline since the advent of the housing crisis," said Tim Martin, group vice president of U.S. Housing in TransUnion's financial services business unit.
Martin said the organization expected a certain amount of improvement during the period, but the magnitude exhibited was pleasantly surprising. Each state, including the District of Columbia reportedly experienced annual decreases in mortgage delinquency rates.