Home Foreclosures Surge 21% in Third Quarter

Wednesday, 21 Dec 2011 11:02 AM

 

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The number of new U.S. home foreclosures jumped by more than 21 percent in the third quarter from the previous quarter as banks moved more aggressively after a pause that began late last year, according to a report released by a bank regulator on Wednesday.

In the final months of 2010 some big lenders, including Bank of America Corp., suspended foreclosure proceedings as they reviewed their methods for dealing with troubled borrowers.

With those reviews completed, the pace of foreclosures is picking up.
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The report, by the Office of the Comptroller of the Currency, said that the large increase in new foreclosures also occurred because banks have "exhausted alternatives to foreclosure for the large inventory of seriously delinquent mortgages working through" the system.

While the number of new foreclosures in the third quarter was much higher than in the previous quarter, it was 11.8 percent less than a year ago.

Other data released this week shows the depressed housing sector is starting to show signs of strength heading into 2012, with the strongest evidence coming from new housing starts for November.

An unexpected 9.3 percent gain to a 685,000 annual rate was the highest level of new-home construction in 19 months. Building permits issued for new houses and apartments climbed 5.7 percent to a more than one-year high.

Sales of previously owned U.S. homes increased 4 percent in November, to an annual rate of 4.42 million units, although downward revisions of data for the last four years showed the housing market recession was deeper than previously thought, according to data released on Wednesday by the National Association of Realtors.

Wednesday's OCC report showed that the number of borrowers making mortgage payments on time in the third quarter remained almost unchanged from the previous quarter.

The OCC said that of the 32.4 million loans covered by the report, 88 percent were considered current and performing.

The OCC Mortgage Metrics Report provides performance data on first-lien residential mortgages serviced by national banks and federally regulated thrifts. The mortgages in this portfolio make up 62 percent of all mortgages outstanding in the United States.

© 2014 Thomson/Reuters. All rights reserved.

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