Foreclosure Inventory Falls to 8-Year Low

The number of U.S. homes in the foreclosure process plunged in 2015 to its lowest level since 2007, an 8-year low. That is just one of several great pieces of new for the mortgage market released by foreclosure information firm CoreLogic in a recent report.

In its November 2015 National Foreclosure Report, CoreLogic showed that there were 448,000 properties in the foreclosure process as of November 2015, a 21.8 percent decline from 573,000 the year before. That number represents 1.2 percent of all U.S. homes with a mortgage, down from 1.5 percent in November. Not only has the foreclosure inventory plummeted but completed foreclosures and serious delinquencies also dropped by double digit percentages in 2015. Completed foreclosures (homes repossessed by lenders) fell to 41,000, down 18.8 percent from 33,000 in November 2014. That marks a 71.6 percent drop from the Great Recession peak of 11,657 in September 2010. Since 2004 there have been roughly 8 million foreclosures nationwide.

“After peaking at 3.6 percent in January 2011, the foreclosure rate currently stands at 1.2 percent—a remarkable improvement,” said CoreLogic chief economist Frank Nothaft. “While there are still pockets of areas with high foreclosure activity, 30 states have foreclosure rates below the national average which is evidence of the solid improvement.”

Serious delinquencies (mortgages that are 90 days or more past due) sunk 21.7 percent as of November 2015 to 1.3 million loans, representing 3.3 percent of all mortgages. The delinquency rate has not been that low since December 2007.

“Tight post-crash underwriting standards coupled with much improved economic and housing market fundamentals have combined to push new mortgage delinquencies to 15-year-lows,” said Anand Nallathambi, president and CEO of CoreLogic. “Although judicial states will likely continue to lag, given current trends, it is reasonable to expect a continued and significant drop in the rate of serious delinquencies and foreclosure starts in 2016.”

The states (and districts) with the highest foreclosure rates in November 2015 were New Jersey with 4.4 percent of all homes, New York with 3.5 percent, Hawaii at 2.5 percent, Florida at 2.4 percent and the District of Columbia with 2.4 percent. On the other end, Alaska had the lowest rate at 0.3 percent, followed by Minnesota at 0.3 percent, Arizona, Colorado and Utah all at 0.4 percent.

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