Record 2.8M Home Foreclosures Last Year

January 14, 2010 8:38 AM EST
Last year a record 2.8 million households were threatened with foreclosures, according to the data released on Thursday by RealtyTrac, the leading online marketplace for foreclosure properties.

The data showed that 2.21 percent of all U.S. units received at least one foreclosure filing during 2009, or one in every 45 households. The total number of foreclosure related notices rose 21 percent from 2008. This includes default notices, scheduled foreclosure auctions and bank repossessions.

More than 349,000 homes in December were sent a foreclosure notice, a 14 percent increase from November and 15 percent from the same month last year.

Bank repossessions exceeded 92,000 homes in the month, an increase of 19 percent from the month prior. According to RealtyTrac, the increase is likely due to the lenders wanting to clear the books before the end of the year.

"Despite all the delays, foreclosure activity still hit a record high for our report in 2009, capped off by a substantial increase in December," said James J. Saccacio, chief executive officer of RealtyTrac. "In the long term a massive supply of delinquent loans continues to loom over the housing market, and many of those delinquencies will end up in the foreclosure process in 2010 and beyond as lenders gradually work their way through the backlog."

Expectations by RealtyTrac are that between 3 million and 3.5 million homes are expected to enter some phase of foreclosure in 2010, according to senior vice president, Rick Sharga.

"It was bad, but it could have been much worse, and it probably should have been worse," Sharga stated.

Home prices have been massively affected by the foreclosure rates across the country. A foreclosed unit lowers the property value of the surrounding homes, and while home prices have stabilized recently, the values are still down 30 percent from mid-2006.

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