Maryland, Pennsylvania See Massive Spikes in Homes Entering Foreclosure

Foreclosure activity increased by 3% in January with certain states experiencing more than a 100% increase in default notices, the first stage in the foreclosure process.

Author:: Jeanine Skowronski
Publish date:: Feb 16, 2012 12:00 AM EST

NEW YORK (MainStreet) — Foreclosure activity increased by 3% in January with certain states experiencing a sharp increase in default notices, RealtyTrac said on Thursday.

The firm’s latest data show that properties entering the first stage of the foreclosure process increased by 100% in Maryland and 112% in Pennsylvania year over year. Florida, Massachusetts and Connecticut all saw default notice spikes over 20% from year over year as well.

Some states, including Florida, Illinois, Indiana and Pennsylvania, saw their foreclosure activity increase year over year for the first time in more than 12 months.

“The foreclosure machine is slowly picking up again,” says Daren Blomquist, RealtyTrac's director of marketing communications. He says the latest round of numbers indicate that the foreclosure filing freeze, resulting from the robo-signing controversy initiated in October 2010, is starting to thaw after almost a year of artificially low numbers.

In total, foreclosure filings were reported on 210,941 U.S. properties last month with one in every 624 U.S. housing units experiencing either a default notice, a scheduled auction or a bank repossession in January.

RealtyTrac expects increases in foreclosure activity will continue due to the finalized mortgage and foreclosure settlement between 49 state attorneys general and five of the nation’s largest lenders reached earlier this month.

“Other roadblocks to foreclosure are still in place at the state level, however, including legislation altering the foreclosure process and lawsuits against lenders,” said CEO of RealtyTrac Brandon Moore in a written statement. “We expect to see somewhat uneven trends in local and regional foreclosure numbers going forward as lenders work through these additional legislative and legal roadblocks.”

Despite the marked increases in certain states, Nevada continues to post the highest foreclosure rates with one in every 198 housing units experiencing a filing in January. It was followed by California, where one in every 265 housing units was distressed and Arizona, where one in every 325 housing units experiencing some stage of foreclosure.

Other states with high foreclosure rates include Georgia, Michigan, Florida, Illinois, Delaware, Colorado and Indiana.

—Jeanine Skowronski is staff reporter for MainStreet. You can reach her by email at Skowronski.jeanine@thestreet.com, or follow her on Twitter at @JeanineSko.