Foreclosure starts have fallen to their lowest level in
six-and-a-half years, after new regulations in California sharply
reduced foreclosure actions there.
Notices of default - the first step in the foreclosure process -
fell 11 percent in January from the previous month, reaching a
level of 65,000 homes, their lowest since June 2006. On an annual
basis, new foreclosures were down 28 percent from their January
A total of 151,000 homes were subject to foreclosure actions of
all types in January - either a notice of default, scheduled
auction or bank repossession - which also represented a 28 percent
annual decline, but down only 7 percent from December's level.
Over 50,000 homes were reposed in January, a 4.9 percent decline
from December and a one-year drop of 24 percent from January
California law has big effect
The one-month drop was spurred by new California legislation
that took effect on Jan. 1, according to Darren Blomquist,
RealtyTrac vice president. California foreclosure starts dropped by
62 percent in January compared to the month before, with the result
that California dropped out of the top spot as the state with the
most foreclosure filings for the first time since January 2007.
The legislation, called the Homeowner's Bill of Rights, puts
into state law many of the terms of the national mortgage
settlement, including a ban on "dual tracking" (when a mortgage
servicer lender pushes ahead with foreclosure proceedings against a
borrower being considered for a loan modification), requiring that
servicers provide borrowers facing foreclosure with a single point
of contact, and imposes fines of up to $7,500 for filing multiple
unverified foreclosure documents.
Florida has most foreclosure actions
Taking over the #1 spot for the month of January was Florida,
which had 30,000 foreclosure actions of all three types during the
month. Unlike the nation as a whole, foreclosure filings in Florida
are on the rise, increasing 12 percent from December's level and up
20 percent from January 2012.
Florida currently has the nation's highest foreclosure rate for
the fifth month in a row, with one in 300 homes subjected to a
foreclosure filing in January, compared to a national rate of one
in 869. Nevada had the second-highest rate, one in 344, despite a
43 percent decrease in overall foreclosure filings compared to
The states with the next highest rates of foreclosure filings
were, in order, Illinois, Arizona, Georgia, Ohio, Washington,
California, Indiana and Michigan.
Foreclosure numbers include only those homes that were subjected
to specific foreclosure actions during the month and do not include
those properties in foreclosure that were not subject to a new
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