REO

Fannie Mae and Freddie Mac servicers will be able to skip a step when attempting to get a short sale or deed-in-lieu of foreclosure approved. On Wednesday, the GSEs announced standard delegation agreements were reached with nine mortgage insurers to allow servicers to approve of short sales and deeds-in-lieu without a separate review process with the mortgage insurer. The agreement takes effect November 1, along with additional short sale guidelines the GSEs announced in August.

Completed foreclosures continued their descent into September, falling 31 percent from a year ago, according to data from CoreLogic. The analytics company reported the number of homes lost to foreclosure in September dropped to 57,000. The decline is a steep drop from 83,000 in September 2011, and a decrease from the upwardly revised 59,000 in August. Before the housing crises, completed foreclosures were much lower than the sinking figures reported recently. Between 2000 and 2006, completed foreclosures averaged 21,000 per month.

In the report from the Center for Responsible Lending, researchers conclude that based on the 10.9 million loans that entered foreclosure between 2007 and 2011, approximately $1.95 trillion in property value has been lost or will be lost by residents who live close to foreclosed properties. This estimate includes losses stemming from completed foreclosures and future losses projected on foreclosure starts. The average spillover cost per family is or will be $21,000 in household wealth, or 7 percent of median home value, according to the report.

In September, home prices improved in nearly all of the largest counties throughout the United States as tracked by DataQuick. According to the company's new Property Intelligence Report (PIR), home prices grew in 40 out of 42 counties month-over-month, while prices improved in all 42 counties from the previous quarter and over the last year. DataQuick suggested the PIR is displaying evidence the recovery in housing is underway, but the PIR found an uneven recovery, with some areas facing risk factors, such as high REO inventory.

LOGS Network, a consortium of default-related firms providing legal and outsourcing solutions for the residential mortgage and consumer credit industries, has added Janeway Law Firm, PC, to its network. Serving the entire state of Colorado, the newest member of LOGS is a full-service law firm and a member of the Fannie Mae retained attorney network.

In September, foreclosure resales accounted for 19 percent of all homes that were resold, a decrease from 19.2 percent in August and 44.4 percent in September 2011. In March 2009, foreclosure resales peaked at 66.2 percent.

A sharp drop in distressed sales is one of the main drivers behind the steady rise in home prices seen in certain areas throughout the country, according to the monthly Campbell/Inside Mortgage Finance HousingPulse survey. In September, the HousingPulse Distressed Property Index (DPI) hit a record low of 38.6 percent based on a three-month moving average. HousingPulse respondents reported major banks seem to be keeping many REO properties off the market this year, but suggested banks may look to release ""significant amounts"" of bank-owned properties next year, which could lead to lower home prices. When real estate agents were asked about the impact of the upcoming national elections, responses were mixed.

Property types at the November 10 auction include commercial, multifamily, single-family residences, and condos. All properties are available for online bidding now until the auction date.

Summer's end may have led to the close of a strong home-buying season, but a decrease in distressed sales is helping prices maintain their yearly gain and some regions are still experiencing monthly price increases. As of August 23, 2012, prices fell 0.4 percent in 25 major U.S. metropolitan areas from July 23, 2012, according to Radar Logic. Year-over-year, prices were still up 4.5 percent, coinciding with a significant decrease in REO and foreclosure auction sales.

A steady drop in distressed home sales may spell a better future for builders, Capital Economics analyst and property economist Paul Diggle says. In a US Housing Market Update released by the firm, Diggle notes that while a substantial overhang of properties still in the shadow inventory will keep distressed sellers in the market, the peak in distressed supply appears to be well behind us, giving homebuilders more room to grow with less competition from discounted existing homes.