Friday, January 13, 2012

Foreclosure Filings To Surge in 2012

The L.A. Times provided a nice graph yesterday showing the annual foreclosure filings dropping off significantly this year from years past.

This was due to the robo-signing scandal that stormed the markets in late 2010 and continued through most of 2011.  Banks were unable to determine who owned the mortgages, which created a delay in foreclosing on the homes without proper title. From the L.A. Times article:

California and other states are likely to see an enormous wave of long-delayed foreclosure action in the coming year as banks deal more aggressively with 3.5 million seriously delinquent mortgages.

And experts said that dealing with the foreclosure process, from issuing notices of default to selling repossessed homes, is likely to push housing prices lower this year before the real estate market has a chance to recover.

The real estate market was in "full delay mode" last year on foreclosures as banks worked to correct legal problems with procedures in many states.

During 2012, it is anticipated that a large portion of these delayed foreclosures will finally appear on the market for sale as the robo-signing issue is unwound and banks begin to give up and take their losses.

The government is already fast at work on new programs to help the housing market during this important election year.  I discussed their most recent plan in 2012 Federal Housing Program: Renting Foreclosures.

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