While foreclosure numbers have declined to about what was seen before the recession, bank repossessions have jumped 66 percent year over year in the third quarter of 2015, reports CNBC.
This jump is the largest annual rise ever recorded in bank repossessions, according to RealtyTrac, a foreclosure sales and analytics company. The company reported that more than 123,000 homes were repossessed from July to September 2015.
States such as New Jersey, Massachusetts and New York have been particularly hit hard by repossessions, according to RealtyTrac, partly because those states’ foreclosure timelines are some of the longest in the country, sometimes taking more than three years. Because of this, banks are finally reaching the repossession stage after years of work.
In addition, more nonbank lenders are moving forward with foreclosures, now that the 6-12 month foreclosure moratorium has been passed.
New Jersey has the nation’s top foreclosure rate, followed by Florida. In fact, New Jersey’s foreclosure rate is more than twice the national average. While the state is seeing a decrease in new foreclosures, bank repossessions increased 351 percent from a year ago.
Formerly struggling states, such as Arizona and California, have seen a decrease in foreclosure activity, while states such as Michigan, Texas and Washington are experiencing average levels of foreclosure activity.
Foreclosure proceedings usually spike between September and November, before holiday moratoria set in, reports CNBC. (Banks often halt evictions throughout the month of December.)
In fact, RealtyTac reports that this increase is a good thing, showing that the foreclosure market has settled into a “normalized pattern.” Daren Blomquist, RealtyTac’s vice president, added that the overall housing market should easily absorb the additional foreclosure activity with little impact on home values, which is always one of the main concerns when it comes to foreclosures and repossessions.
In Minnesota, there has been a steep decline in foreclosure activity, with rates dropping to the lowest level since 2005, according to Minnesota Homeownership Center. The center reported that only about 8,300 homes were foreclosed in 2014, a decrease of more than 29 percent from 2013. In fact, for the first time in a decade, no county in Minnesota had more than 1 percent of its residential parcels subject to a foreclosure sale in 2014—and no county had a foreclosure rate of more than 1 percent. In addition, 64 percent of households seeking free foreclosure prevention services in 2014 were able to avoid foreclosure.