Many new foreclosed properties will be placed on the market by early 2013, because banks are reporting a large number of homes that have unpaid mortgages which will be moving into foreclosure.
RealtyTrac Inc. reported that the recently released June 2012 figures showed, that for the second month in a row, the number of homes in the United States which are moving into foreclosure has increased on a yearly basis.
These figures showed that there was a large spike in California for homes that were moving into foreclosure for the very first time. These first time foreclosed upon homes, increased approximately 18%, over the June 2011 figures that were reported.
The increased homes that are going into first time foreclosure is happening just as banks are trying to make up for all the lost time from last year, where the mortgage and lending industry were dealing with allegations of processing foreclosures without proper verification of the documents.
The largest mortgage lenders in America reached a staggering $25 billion settlement with state officials in February. With that issue out of the way, banks are now free to concentrate on their backlog of mortgages that are unpaid.
Fitch Ratings showed that lenders started foreclosure proceedings on 12% of mortgage loans that were late in June, which was the highest since the first 6 months of 2009.
A vice president at RealtyTrac, Daren Blomquist said, “These properties that are starting the foreclosure process are mostly homeowners who likely have been missing payments for a year or more and just now are officially starting the foreclosure process.”
Since these homeowners have been missing payments for so long, the new homes that are moving into foreclosure do not represent a new wave of homes that are in distress and missing payments, they have already been accounted for in the figures of mortgages that were not being paid.
One of the consequences of adding these properties into the foreclosed inventory, will be that the nearby home values will begin to decrease. This may take many months for all the homes to go through the foreclosure process and be placed back on the market, which typically depends upon the geographical location.
According to RealtyTrac, in the second quarter of 2012, the U.S. home foreclosure process was running around an average of 378 days for foreclosed properties to complete the foreclosure process or return back to the control of the bank.
Even though home prices are still expected to be higher than last years, because of a stronger housing market, there are economists that feel a full housing market recovery is still many years away.
The Mortgage Bankers Association reports that there are approximately 3 million homes in the U.S. that have mortgages in arrears. These do not include the approximate 629,000 homes that banks are holding on their books, which have not been sold yet. RealtyTrac says these 629,000 homes represent an approximate 15 month supply, when taking into account the pace at which homes are currently selling.
There are approximately 13 million homes that are underwater, where people owe more on the home than the home is worth. When a home is underwater, it faces a much higher risk of moving into the foreclosure process, because many people will not pay on a mortgage for a home that has a value less than the mortgage amount.
These figures are good news for real estate agents and brokers that want to get their share of the millions of REO listings which will be available over the next few years. REO training is available for these real estate agents and brokers from ASREOS.com.
Now is the time for real estate agents and brokers to position themselves as the REO industry leaders, because they will be in great demand over the next few years. Visit ASREOS.com for tools, resources, and training to take advantage of the lucrative REO market that is growing in America.