U.S. foreclosures have fallen to their lowest rate since February 2008, as states clear the backlog of foreclosures from the crisis years and the market slowly returns to normal.
At 1.76% of active mortgages, the inventory of loans in foreclosure is at its lowest point since February 2008, according to data released Friday from Black Knight Financial Services, a mortgage technology and information services firm based in Jacksonville, Fla. This “first look” at September month-end mortgage performance derived from a database representing two-thirds of the overall market.
That equates to 893,000 loans in the foreclosure process, a 33% decline of 435,000 from 1.3 million last year. That bodes well for the housing market, experts say. Jed Kolko, chief economist for real-estate website Trulia, says the delinquency and foreclosure rate is 74% back to normal in the fourth quarter versus 56% a year ago, while home prices and sales are 75% and 80% back to normal, respectively.
The total “non-current” inventory — 30 or more days past due or in foreclosure — fell by 117,000 on the month to 2,878,000 in September. The inventory of “seriously delinquent” loans — those 90 or more days past due — declined by 25,000 on the month to 1,118,000 in September reaching its lowest point August 2008, and number of properties in foreclosure of 30 days or more fell 137,000 to 3,771,000. And the number of properties in foreclosure inventory fell 20,000 to 893,000 in September.
The states with the most delinquencies or foreclosures in September are Mississippi (14.41% of all loans), New Jersey (12.17%), Louisiana (11.16%), New York (10.76%) and Florida (10.55%). The states with the least number of delinquencies or foreclosures are North Dakota (2.43% of all loans), South Dakota (3.64%), Colorado (3.72%), Montana (3.89%) and Minnesota (4.03%). Mississippi, Alabama, Rhode Island, Louisiana and Massachusetts also had the most serious delinquencies (90 days or more).