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Default notices, home seizures climb in Indiana, nation

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Indiana outpaced the rest of the nation last month in the number of default notices sent to delinquent homeowners and the amount of homes seized, according to RealtyTrac Inc.

Default notices in Indiana climbed 61 percent from September while home seizures in the state jumped 73 percent.

The sobering numbers are part of the Irvine, Calif.-based data seller’s national report, which says U.S. foreclosure filings rose 7 percent in October to a seven-month high as lenders began to speed up action against delinquent homeowners.

A total of 230,678 properties received notices of default, auction or repossession, compared with 214,855 in September, RealtyTrac said. One in every 563 U.S. households got a filing.

Notices, however, are still down 31 percent from October 2010. That's when banks and loan servicers began slowing the process after complaints over the way they handled documents for defaults and home seizures.

But the monthly gain in filings signals that a “rain delay” in foreclosures may be easing, according to RealtyTrac CEO James J. Saccacio. The backlog has been partly to blame for a stalled U.S. housing recovery, he said.

“Sloppy paperwork, government intervention, a slow economy and lack of confidence is a giant concoction lengthening the process,” Saccacio said.

He estimated that the U.S. housing market needs as long as 40 months to clear a glut of distressed homes that includes properties with negative equity. Almost 29 percent of Americans with a mortgage owe more than their property is worth, Zillow Inc. said this week.

Default notices increased 10 percent in October from September and rose to an 11-month high in so-called judicial states, where most bank delays had been occurring because the courts oversee foreclosures. Default filings jumped 28 percent in Florida, 50 percent in Pennsylvania and 61 percent in Indiana from September, according to RealtyTrac.

U.S. auction notices climbed 8 percent from September, including a 22-percent increase in judicial states. They rose 57 percent in Florida, 43 percent in Minnesota and 38 percent in Illinois. Total scheduled auctions were down 38 percent from October 2010.

Home seizures jumped 4 percent from the previous month, while falling 27 percent from a year earlier. They climbed sequentially by 40 percent in Michigan, 45 percent in Oregon, 48 percent in New Jersey and 73 percent in Indiana, according to RealtyTrac.

Nevada’s rate of filings per household, one in every 180, was more than three times the national average and the highest in the U.S. for the 58th straight month. Filings there fell 75 percent from September as a new state law required foreclosing lenders to sign and publicly record affidavits of “key” information, according to RealtyTrac.

California had the second-highest rate at one in 243 households, and Arizona was third at one in 259. Florida, Illinois, Idaho, Oregon and Colorado also ranked in the top 10.

In Indiana, 3,573 properties fell into foreclosure last month, or one in every 786 households, ranking it 16th in the nation. Nearly one third of those, or 1,080, were in Marion County.

Five states accounted for 53 percent of all U.S. filings. California led with 55,312, with Nevada, Arizona, Florida and Michigan also among the top five, said RealtyTrac.

The company sells default data from more than 2,200 counties representing 90 percent of the U.S. population.

 

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