Foreclosures Up 11 Percent in Second Quarter

Foreclosures filings rose nearly 11 percent in the second quarter of the year, as a number of lenders lifted voluntary moratoriums that had been in place during the first few months of the year and job losses continued to take their toll on the housing market.

According to a new report from the online foreclosure marketplace RealtyTrac, foreclosures were filed on nearly 900,000 U.S. homes in the second quarter of 2009, bringing the total to more than 1.5 million properties so far this year. Nationwide, 1.2 percent of all homes, or one in 84, have been the subject of a foreclosure filing in the first six months of the year.

Unemployment the key factor

"In spite of the industry-wide moratorium earlier this year, along with local, state and national legislative action and increased levels of loan modification activity, foreclosure activity continues to increase to record levels," said James Saccacio, RealtyTrac CEO. "Unemployment-related foreclosures account for much of this increased activity, and the high number of borrowers who find themselves owing more on their mortgages than their homes are now worth represent a potentially significant future risk."

A total of 336,000 properties received foreclosure filings in June, an increase of 4.6 percent from the previous month and an increase of one-third over June 2008. It's the fourth month in a row that properties receiving foreclosure filings exceeded 300,000.

One in 16 foreclosure rate in Nevada

Nevada had the highest rate of foreclosures in the first six months of the year, with 6.2 percent, or one property in 16, being the subject of at least one foreclosure filing during that time. Arizona (3.37 percent), Florida (3.08) and California (2.94) held the next three spots, each with about one home in 30 in some stage of foreclosure during that time. Other states in the top 10 were, in order: Utah (1.46 percent), Georgia (1.42), Michigan (1.34), Illinois (1.31), Idaho (1.26) and Colorado (1.25).

The report did offer encouraging news for some states, particularly Connecticut, where foreclosures have been decreasing over the past year and fell nearly 50 percent compared to the first quarter of the year. Other states where foreclosure rates fell significantly in the second quarter of year included Illinois (down 16 percent), Oregon (down 8.7 percent) and New Hampshire (down 8.0 percent). Even Arizona showed an improvement in the second quarter despite its second-highest foreclosure rate, with filings down by 2.5 percent in the second quarter.

The survey is based on foreclosure filings in more than 2,200 U.S. counties representing approximately 90 percent of the population. Foreclosure filings include documents filed at multiple stages of the foreclosure process, though a single property is listed only once within a given reporting period of the survey.