In a sign that housing continues to move toward stability, February 2015's total of 39,000 completed foreclosures nationwide represented a decline of 15.7 percent from the previous February – and a decline of 67 percent from their peak reached in September 2010, according to CoreLogic's February 2015 National Foreclosure Report released Tuesday.
February 2015's total of completed foreclosures, which are an indication of the total number of homes lost to foreclosure, was still nearly double the pre-recession monthly average of 21,000 (from 2000 to 2006) but that completed foreclosures have been steadily rolling downhill toward pre-recession levels for many months. About 5.6 million homes have been lost to foreclosure since September 2008, when the financial crisis began, and about 7.7 million foreclosures have been completed since homeownership rates peaked in the second quarter of 2004.
Foreclosure inventory, which is the number of homes in some state of foreclosure, totaled 553,000 in February (about 1.4 percent of all residential mortgages nationwide), the lowest total since March 2008 and a year-over-year decline of 27.3 percent from February 2014, when there were 761,000 homes in some state of foreclosure (1.9 percent of all residential mortgages).
"The number of homes in foreclosure proceedings fell by 27 percent from a year ago and stands at about one-third of what it was at the trough of the housing cycle," said Frank Nothaft, chief economist at CoreLogic. "While the drop in the share of mortgages in foreclosure to 1.4 percent is a welcome sign of continued recovery in the housing market, the share remains more than double the 0.6 percent average foreclosure rate that we saw during 2000-2004."
The number of seriously delinquent mortgages nationwide in February 2015 totaled 1.5 million (4 percent), a drop of 19.3 percent from a year earlier and the lowest total since June 2008. A seriously delinquent mortgage is defined as 90 days or more overdue, in the process of foreclosure, or REO.
Thirty-four states posted a foreclosure inventory percentage below the national average of 1.4 percent in February, according to CoreLogic. Forty-four states posted a double-digit year-over-year decline in foreclosure inventory, with only two states (Massachusetts and Wyoming) and the District of Columbia posting increases. Nine states posted a year-over-year decline in foreclosure inventory of 30 or more percent, led by Florida (46.4 percent) and Maine (42.2 percent).
"The foreclosure inventory dropped year over year in all but two states," said Anand Nallathambi, president and CEO of CoreLogic. "The foreclosure rates in judicial foreclosure states are beginning to pick up and remain higher than in non-judicial states. What's encouraging is that fewer Americans are seriously delinquent in paying their mortgages, which in turn is reducing the foreclosure inventory across the country as a whole."
The state with the highest foreclosure inventory rate in February was New Jersey, at 5.3 percent, followed by New York (4.0 percent), Florida (3.4 percent), Hawaii (2.8 percent), and Washington, D.C. (2.6 percent). The state with the lowest percentage was Alaska, at 0.3 percent. New Jersey also had the highest serious delinquency rate for the month at 9.0 percent.
The state with the highest number of completed foreclosures for the 12-month period from March 1, 2014 to February 28, 2015 was Florida with approximately 110,000, followed by Michigan (50,000), Texas (34,000), California (30,000), and Georgia (26,000). Those five states accounted for nearly half of the nationwide total of 550,000 for the 12-month period. The state with the lowest number of completed foreclosures for that same period was South Dakota with 15, according to CoreLogic.