Experts are predicting that foreclosures will surge again in 2012, after hitting a lull in 2010 and 2011. RealtyTrac, a company tracking foreclosure and mortgage delinquency data, released a report April 26, 2012 about the foreclosure statistics in 212 metro areas across the U.S. States with foreclosure laws requiring a judge to approve foreclosures, such as Florida, demonstrated a dramatic increase in the number of foreclosures in the first quarter of 2012.
Miami’s foreclosure rate increased by 37 percent compared to this time last year, while Orlando foreclosures rose by 52 percent. Palm Bay demonstrated a startling 148 percent increase in foreclosures.
In light of the “robo-signing” scandal that arose in 2010, where homeowners and state officials alleged that mortgage lenders were improperly foreclosing on people without adequate documentation, many lenders stopped initiating foreclosure actions altogether in states that required judges to scrutinize the paperwork before approving the foreclosure until the matter was settled.
According to RealtyTrac data, foreclosures fell in Miami from about 58,000 in the last quarter of 2010 to approximately 19,000 in the first quarter of 2011 after the scandal broke. The number of foreclosures rose to around 26,000 in the first quarter of 2012.
Industry analysts suggest that now that the biggest mortgage lenders have entered into a settlement regarding the mortgage foreclosure abuses, they will be free to resume foreclosure activity at their previous rate.
Those struggling financially and unable to pay their mortgages who had been relying on the reluctance of banks to bring foreclosures to keep their homes may need to explore other options to make sure they do not lose their houses.
Source: CNN Money, “Logjam in foreclosure filings breaking up,” Les Christie, April 26, 2012.