2011 U.S. foreclosure rate lowest since 2007

About 1.9 million homes entered the foreclosure process in 2011, the lowest level since 2007, when the recession began, according to a report released today by foreclosure listing firm RealtyTrac Inc. The firm cautions the decline does not necessarily indicate that the housing market is getting better, as many foreclosures have been delayed due to confusion over documentation and legal issues involved in the process. There have also been problems with the way some lenders have handled foreclosures: specifically, signing off on home foreclosures without first verifying documents—a practice referred to as “robo-signing.” Many of the nation’s largest banks reacted to the resulting problems by temporarily ceasing all foreclosures, re-filing previously filed foreclosure cases and revisiting pending cases to prevent errors. “Foreclosures were in full delay mode in 2011, resulting in a dramatic drop in foreclosure activity for the year,” RealtyTrac CEO Brandon Moore says in a statement. The listing firm anticipates that 2012’s foreclosure rate will be higher than last year’s but will remain below the peak of 2010. RealtyTrac says 2011’s foreclosure activity is 34% lower than 2010 and the lowest since 2007. The Great Recession officially began in December 2007 and ended in June 2009, though the effects still linger. In the fourth quarter, there were foreclosure filings for 586,133 homes in the United States, down 27% from a year earlier. Nevada, Arizona and California were among the states with the most foreclosures last year, while Georgia, Michigan, Florida, Illinois, Colorado and Idaho had the highest foreclosure rates.