REALTY TRAC: Illinois Tops August 2012 Foreclosure Report for First Time

20  States Post Year-Over-Year Increases in Foreclosure Activity
By David M. Kinchen

RealtyTrac  ( has  released its U.S. Foreclosure  Market Report  for August 2012, which shows foreclosure filings — default  notices, scheduled auctions and bank repossession — were reported on 193,508 U.S. properties in August, an  increase of 1 percent from July but down 15 percent from August 2011. The  report also shows one in every 681 U.S. housing units with a foreclosure filing  during the month.

Illinois posted the nation’s highest foreclosure  rate, one in every 298 housing units with a foreclosure filing. August was the  first month that Illinois has ranked No. 1 since RealtyTrac began issuing its  report in January 2005.

 “Bucking the national trend, deferred foreclosure  activity boiled over in several states in August,” said Daren Blomquist, vice  president of Irvine, CA-based RealtyTrac. “In judicial states such as Florida, Illinois, New  Jersey and New York, this was a continuation of a trend we’ve been seeing for  several months now. The increases in Florida and Illinois pushed foreclosure  rates in those states to the two highest in the country — supplanting the  non-judicial states of Arizona, California, Georgia and Nevada. Previous to  August, the nation’s top two state foreclosure rates have been from those four non-judicial  states every month since December 2010.”


“Meanwhile foreclosure activity in most  non-judicial states stayed on a downward trajectory in August, with a few  exceptions,” Blomquist added. “Most notably, Washington state documented a  38 percent annual increase in foreclosure activity in August after 16 straight  months of year-over-year declines. The rebounding activity in Washington state  is likely the result of lenders catching up with foreclosures delayed by a  state law that took effect in July 2011 and allowed homeowners facing  foreclosure to request mediation. This rebounding pattern will likely be  repeated in the coming months in other states that have passed legislation  delaying the foreclosure process.”

High-level findings from the report:

  • Twenty states registered year-over-year increases  in foreclosure activity, led by judicial foreclosure states such as New Jersey,  New York, Maryland, Illinois and Pennsylvania.
  • Following three straight months of year-over-year  increases, U.S. foreclosure starts in August decreased 13 percent from a  17-month high in August 2011. Foreclosure activity in the 24 non-judicial states and  District of Columbia combined decreased 31 percent annually, although 15  non-judicial states and DC posted monthly increases in foreclosure activity,  including Arkansas (61 percent), Utah (41 percent), Colorado (25 percent) and  Washington (23 percent).
  • U.S. bank repossessions (REO) in August decreased 2  percent from the previous month and were down 19 percent annually — the 22nd  consecutive month with a year-over-year decline in REOs. 

Foreclosure starts —  default notices or scheduled foreclosure auctions, depending on the state — were filed for the first time on 99,405  U.S. properties in August, a 1 percent increase from July but down 13 percent  from August 2011, when foreclosure starts hit a 17-month high.

Foreclosure starts increased annually in 18 states,  including Washington (143 percent), Pennsylvania (129 percent), Alabama (102  percent), New Jersey (101 percent) and New York (63 percent).

Other states with sizable annual increases in  foreclosure starts included Minnesota (42 percent), North Carolina (36  percent), Maryland (29 percent), Florida (26 percent) and Illinois (18  percent).

States with some of the biggest annual decreases in  foreclosure starts included Oregon (89 percent), Nevada (64 percent), Utah (57  percent), Massachusetts (47 percent), California (42 percent), Arizona (41  percent) and Georgia (31 percent). Recent legislation or court rulings in  Oregon, Nevada, Massachusetts, California and Georgia could be contributing to  a slowdown in those states.

Lenders completed the foreclosure process on 52,380  U.S. properties in August, a 2 percent decline from the previous month and a 19  percent decrease from August 2011 — the 22nd consecutive month with  a year-over-year decline in bank repossessions.

REO activity decreased annually in 35 states and  the District of Columbia. Some of the biggest state REO decreases were in  Nevada (76 percent), Oregon (57 percent), Virginia (56 percent), Washington (46  percent), Utah (46 percent), Massachusetts (43 percent), Pennsylvania (43  percent), and Colorado (43 percent).

States with some of the biggest annual increases in  REO activity included Kentucky (44 percent), Illinois (41 percent), Wisconsin  (32 percent) and Maryland (23 percent).

Illinois posted  the nation’s highest state foreclosure rate in August thanks to a 29 percent  jump in overall foreclosure activity from the previous month. A total of 17,781  Illinois properties had a foreclosure filing in August, one in every 298  housing units and an increase of 42 percent from August 2011. Illinois  foreclosure activity was up across the board — foreclosure starts increased 18  percent annually, scheduled foreclosure auctions were up 116 percent annually,  and bank repossessions were up 41 percent annually. August marked the eighth  consecutive month where Illinois foreclosure activity increased on a  year-over-year basis.

Despite a 32 percent  year-over-year decrease in overall foreclosure activity in August — the ninth  consecutive month with an annual decrease —  California still  posted the nation’s third highest state foreclosure rate. One in every 340  California housing units had a foreclosure filing in August — twice the  national average.

 Florida foreclosure activity in August increased on a year-over-year basis for the seventh time  in the last eight months, helping the state post the nations’ second highest  foreclosure rate: one in every 328 housing units with a foreclosure filing.  Florida foreclosure starts increased 26 percent annually while scheduled  foreclosure auctions were up 4 percent and bank repossessions were up 12  percent.

Other states with  foreclosure rates among the nation’s 10 highest were Arizona (one in every 360  housing units with a foreclosure filing), Nevada (one in 402 housing units),  Georgia (one in 431 housing units), Ohio (one in 556 housing units), Michigan  (one in 593 housing units), Delaware (one in every 610 housing units) and  Colorado (one in every 617 housing units). 

Foreclosure activity in  August increased from the previous month in eight of the 10 cities with the nation’s  highest foreclosure rates among metropolitan areas with a population of 200,000  or more.

Foreclosure activity  increased from the previous month in the California cities of Modesto (14  percent), Merced (50 percent), Bakersfield (62 percent), Fresno (178 percent)  and Chico (87 percent). In Merced, foreclosure activity increased 13 percent  from August 2011 after 33 months of year-over-year decreases.

Other top 10 cities with  an increase in foreclosure activity from the previous month were Chicago (28  percent) and Rockford, Ill. (15 percent) and Miami (49 percent).

Modesto, Calif., posted  the nation’s highest metro foreclosure rate, one in every 172 housing units  with a foreclosure filing in August — nearly four times the national average —  and the top seven metro foreclosure rates were in California.


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