Florida Foreclosures-We're #4

[Lax1]

Home foreclosure filings rose 14 percent in the second quarter, the eighth consecutive quarterly climb, and more than doubled from the same period a year-earlier, real estate data firm RealtyTrac said on Friday.

Home foreclosure filings during the second quarter were reported on 739,714 U.S. properties, up 121 percent from a year earlier, RealtyTrac, an online market of foreclosure properties, said in a report.

Nevada had the highest foreclosure rate in the country, with one foreclosure filing for every 43 households, followed by California and Arizona.

Florida ranked fourth with one foreclosure filing for every 78 households in the second quarter, with 109,433 filings, up nearly 25 percent from the previous quarter and 182 percent higher than the second quarter of 2007, RealtyTrac said.

 

[nauthead]

I think my wife foreclosed most of them. She is at the courthouse every week buying back properties for banks.

 

[Howard Klahr]

This would be interesting if only data from Realtytrac was remotely accurateSeattle Times - Numbers from foreclosure statistics company questioned

 

[Lax1]

So we are not #4?

 

[Couch Potato]

Howard, the data is accurate. What is not accurate is the reporting. RealtyTrac accurately reports the level foreclosure related activity. As anyone who has held a mortgage knows, you may start the foreclosure process several times on the same house in a given year. The last one I had required me to start the foreclosure process 17 times in a five year period before they finally found a buyer to take the house.

RealtyTrac does not claim to be reporting the number of foreclosures that go to a sale. Unfortunately there are often people writing stories who are clueless about real estate and misuse the numbers. The proper use of RealtyTrac numbers is meaningful. It is an excellent gage of foreclosure activity and economic health of the housing market. It is not a gage of foreclosure sales.

 

[Howard Klahr]

Greg,

I understand your point; however, the methodology utilized in RealtyTrac's data reporting overstates information based upon commonly accepted definitions. Here is how the foreclosure statistics are defined by RealtyTrac

"Foreclosure filings include foreclosure-related documents in all three phases of foreclosure: Default — Notice of Default (NOD) and Lis Pendens (LIS); Auction — Notice of Trustee Sale and Notice of Foreclosure Sale (NTS and NFS); and Real Estate Owned, or REO properties (that have been foreclosed on and repurchased by a bank)."

However, foreclosure is not defined by the filing of an action but rather is only the actual court decision to award the property back to the lender. So therefore the grouping of lis pendence filings into the foreclosure statistics overstates the information. Since every stage of the process is counted in their data reporting, the same property is counted multiple times for the same action. In addition, in Florida as you are aware, many properties have at least two mortgages so as to avoid PMI coverage. Consequently, the foreclosure statistics reported through RealtyTrac will again reflect multiple filings on the same property.

This has been recently acknowledged by RealtyTrac in their posting of not just foreclosure data under their definition but adding a new category that reports just the number of affected properties. This has limited affect however because their ranking process compares only the foreclosure filings between other market areas which do not have as many second liens as Florida properties. Consequently, this again overstates the information due to inequitable comparisons.

I am not trying to indicate that there is not a problem within the market, just that what is reported does not reflect actual activity. We are in agreement however, that the biggest issue is the misuse of the data due to a lack of understanding of both the process and what the underlying data contains.

 

[Couch Potato]

It is impossible to have any valid comparison due to variations in procedures from state to state. If a person surrenders their deed to the lender, there is no foreclosure, but it is certainly a comparable process.