U.S. foreclosure rates jump sharply in July

U.S. foreclosure rates jump sharply in July
Alex Veiga
Associated Press
Aug. 21, 2007 12:25 PM

LOS ANGELES - The number of foreclosure filings reported in the U.S. last month jumped 93 percent from July of 2006 and rose 9 percent from June, the latest sign that homeowners are having trouble making payments and finding buyers during the national housing downturn.

There were 179,599 foreclosure filings reported during July, up from 92,845 during the same period a year ago, Irvine-based RealtyTrac Inc. said Tuesday. There were 164,644 foreclosure filings reported in June.

The national foreclosure rate in July was one filing for every 693 households, the company said.

"While 43 states experienced year-over-year increases in foreclosure activity, just five states - California, Florida, Michigan, Ohio and Georgia - accounted for more than half of the nation's total foreclosure filings," RealtyTrac Chief Executive James J. Saccacio said.

The filings include default notices, auction sale notices and bank repossessions.

Some properties included in the survey might have received more than one notice, if the owners have multiple mortgages.

The company did break out individual properties as part of its report for the first six months of this year, when a total of 573,397 properties reported some sort of foreclosure activity.

That represents a 58 percent jump from the 363,672 properties in the first six months of 2006 and a 32 percent increase from the 433,504 in the last six months of 2006, the firm said.

In the July report, Nevada, Georgia and Michigan accounted for the highest foreclosure rates nationwide.

Nevada posted the highest foreclosure rate: one filing for every 199 households, or more than three times the national average. It reported 5,116 filings during the month, an increase of 8 percent from June.

Georgia's foreclosure rate was more than twice the national average, with one filing for every 299 households. The state reported 12,602 foreclosure filings, up 75 percent from June.

Michigan reported 13,979 filings in July, a 39 percent spike from June.

California, Florida and Ohio were among the states with the highest number of foreclosure filings in July, RealtyTrac said.

California cities continued to dominate top metropolitan foreclosure rates.

The state reported 39,013 foreclosure filings last month, the most by any single state. However, the number of filings rose less than 1 percent from June.

The state's foreclosure rate was one filing for every 333 households, RealtyTrac said.

Florida's foreclosure filings dropped 9 percent between June and July to 19,179. The July figure, however, represents a 78 percent jump from the year-ago period.

In recent months, the mortgage industry has been battered by rising defaults and foreclosures, primarily driven by borrowers with subprime loans and adjustable rate mortgages.

Lagging home sales and flat or decreasing home prices have made it more difficult for homeowners who fall behind on payments to sell their homes and clear the debt, spurring the rise in foreclosure activity.

Loan types seeing higher delinquencies and defaults in general are home equity loans or second mortgages used to cover a downpayment, subprime loans to people with shaky credit histories, and Alt-A loans, which can include interest-only and adjustable rate mortgages sold with little or no documentation.