Dive Brief:
-
There’s good news on the foreclosure front: Two housing organizations last week reported the number of completed foreclosures dropped between September and November and from 2013 to 2014.
-
CoreLogic’s October National Foreclosure Report estimated 41,000 completed foreclosures countrywide in October, down from 62,000 in September and 55,000 in October 2013. RealtyTrac reported 112,498 foreclosure filings in November, down 9% from the previous month and 1% from a year ago. Foreclosure filings include default notices, scheduled auctions, and bank repossessions.
-
The downside, according to RealtyTrac: Foreclosure rates on brand-new loans originated in 2014 are higher than for loans originated last year. That could indicate that lenders are taking more risks when approving applicants for home loans than they were before.
Dive Insight:
The rate of foreclosures could teeter between positive and negative as lenders gain their footing in a new lending environment that tolerates slightly more risk than the ultra-tight credit market has for the past five years.
RealtyTrac Vice President Daren Blomquist explained: “The housing market is struggling to find the new normal when it comes to a tolerable level of foreclosure activity in this post-Great Recession economy. Finding that new normal requires striking a balance between too much loan risk, which would result in another housing meltdown, and too little risk, which could result in a stunted recovery.”