WASHINGTON (MNI) – The following is the first part of the text of
the RealtyTrac’s September U.S. Foreclosure Market Report published
Thursday:

RealtyTrac (www.realtytrac.com), the leading online marketplace for
foreclosure properties, today released its U.S. Foreclosure Market
Report for September and the third quarter of 2012, which shows
foreclosure filings – default notices, scheduled auctions and bank
repossessions – were reported on 180,427 U.S. properties in September, a
decrease of 7 percent from the previous month and down 16 percent from
September 2011. September’s total was the lowest U.S. total since July
2007.

The decrease in September helped drop the third quarter foreclosure
numbers to the lowest level since the fourth quarter of 2007.
Foreclosure filings were reported on 531,576 U.S. properties during the
quarter, a decrease of 5 percent from the second quarter and a decrease
of 13 percent from the third quarter of 2011 – the ninth consecutive
quarter with an annual decrease in foreclosure activity. The report also
shows one in every 248 U.S. housing units with a foreclosure filing
during the quarter.

“We’ve been waiting for the other foreclosure shoe to drop since
late 2010, when questionable foreclosure practices slowed activity to a
crawl in many areas, but that other shoe is instead being carefully
lowered to the floor and therefore making little noise in the housing
market – at least at a national level,” said Daren Blomquist, vice
president at RealtyTrac. “Make no mistake, however, the other shoe is
dropping quite loudly in certain states, primarily those where
foreclosure activity was held back the most last year.

“Meanwhile, several states where the foreclosure flow was not so
dammed up last year could see a roller-coaster pattern in foreclosure
activity going forward because of recent legislation or court rulings
that substantively change the rules to properly foreclose,” Blomquist
added. “A backlog of delayed foreclosures will likely build up in those
states as lenders adjust to the new rules, with many of those delayed
foreclosures eventually hitting down the road.”

Other high-level findings from the report

– The national decrease in September and the third quarter was
driven mostly by sizable decreases in the non-judicial foreclosure
states such as California, Georgia, Texas, Arizona and Michigan.

– Several judicial foreclosure states – including Florida,
Illinois, Ohio, New Jersey and New York – continued to buck the national
trend, registering substantial year-over-year increases in foreclosure
activity in September and the third quarter.

– U.S. foreclosure starts in the third quarter decreased both from
the previous quarter and a year ago, reversing a bump in foreclosure
starts in the second quarter.

– California foreclosure starts (NOD) in September decreased 18
percent from the previous month and were down 45 percent from a year ago
to a 69-month low, although the state’s foreclosure rate still ranked in
the top three for the month and quarter.

– Florida foreclosure starts (LIS) in September increased 24
percent on a year-over-year basis, the 11th consecutive month with an
annual increase, and the state’s foreclosure rate ranked highest
nationwide for the first time since April 2005.

Non-judicial states push national numbers lower Of the 24 states
where the non-judicial foreclosure process is primarily utilized, 20
reported annual decreases in foreclosure activity in the third quarter,
including Nevada (71 percent decrease), Oregon (63 percent decrease),
Utah (60 percent decrease), Virginia (34 percent decrease), California
(29 percent decrease), Michigan (28 percent decrease), Arizona (23
percent decrease), Colorado (21 percent decrease), Georgia (20 percent
decrease) and Texas (17 percent decrease).

Nevada, Oregon and California have all enacted legislation within
the past year adding more requirements for lenders to properly
foreclose, while a Georgia Court of Appeals ruling in July of this year
requires lenders to provide certain information on foreclosure notices
that some lenders may not have been including previously.

Washington state was one of only four non-judicial foreclosure
states where foreclosure activity increased in the third quarter, up 70
percent from the previous quarter and up 15 percent from the third
quarter of 2011. Washington state was one of the first non-judicial
states to enact legislation impacting the foreclosure process following
the so-called robo-signing controversy that came to light in October
2010. The state legislature passed a law that took effect in July 2011,
requiring lenders to offer mediation to homeowners facing foreclosure.

Judicial states buck national trend

Meanwhile, third quarter foreclosure activity increased on a
year-over-year basis in 14 out of the 26 states with a primarily
judicial foreclosure process, including New Jersey (130 percent
increase), New York (53 percent increase), Indiana (36 percent
increase), Pennsylvania (35 percent increase), Connecticut (34 percent
increase), Illinois (31 percent increase), Maryland (28 percent
increase), South Carolina (16 percent increase), North Carolina (14
percent increase), and Florida (14 percent increase).

Some notable exceptions where foreclosure activity in the third
quarter decreased on annual basis in judicial foreclosure states
included Massachusetts (16 percent decrease) and Wisconsin (12 percent
decrease).

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** MNI Washington Bureau: 202-371-2121 **

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