Thursday, August 11, 2011

Slow pace of foreclosures could delay housing recovery

Foreclosure filings across Broward and Palm Beach counties are down in July by more than 50 percent compared with a year ago, according to RealtyTrac Inc., an Irvine, Calif.-based listing firm.

Nationally, foreclosure activity hit a 44-month low.

It’d be great if all this were a sign of an improving economy, but it’s not.

“This string of decreases was initially triggered by the robo-signing controversy back in October 2010, which forced lenders to substantially slow the pace of foreclosing, but the downward trend in foreclosure activity has now taken on a life of its own,” RealtyTrac CEO James J. Saccacio said in a statement. “It appears that the foreclosure processing delays, combined with the smorgasbord of national and state-level foreclosure prevention efforts — including loan modifications, lender-borrower mediations and mortgage payment assistance for the unemployed — may be allowing more distressed homeowners to stave off foreclosure.”

While foreclosures heap pain on families and neighborhoods, they're necessary to help wipe the slate clean and help the market recover, experts say. Saccacio said these foreclosure delays are likely to extend our housing woes into 2012 and beyond.

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By Paul Owers

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