Foreclosure Inventory Down From a Year Ago, Up From Previous Month

While foreclosure inventory showed a year-over-year decline for January 2012, REO inventory held by servicers grew faster in January than the pace at which REO properties sold, according to CoreLogic's ""National Foreclosure Report"":http://www.corelogic.com/about-us/researchtrends/national-foreclosure-report.aspx for January 2012 released Thursday.

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The distressed clearing ratio, which calculates the rate at which REO properties are sold, was 0.69 for January 2012, down from 0.80 in December 2011. The ratio is found by dividing the number of REO sales by the number of completed foreclosures. A higher ratio indicates a faster pace of REO sales relative to the pace of completed foreclosures.

""The pace of completed foreclosures is gradually increasing again, but the clearing ratio is falling as REO sales have slowed in the winter months,"" said Mark Fleming, chief economist with CoreLogic, who also added non-judicial foreclosure states completed almost twice as many foreclosures per 1000 active loans as judicial foreclosure states in January.

On a year-over-year basis, the number of foreclosures actually dropped, going from 80,000 in January 2011 to 69,000 in January 2012, according to CoreLogic's report, which provides monthly data on completed foreclosures, foreclosure inventory, and 90+ delinquency rates. But, compared to the previous month, there was a slight increase, with 65,000 completed foreclosures in December 2011.

Approximately 1.4 million homes, or 3.3 percent of all homes with a mortgage, were in the foreclosure inventory as of January 2012, compared to 1.5 million, or 3.6 percent, in January 2011, according to ""CoreLogic"":http://www.corelogic.com/. For the previous month of December, 3.4 percent of all homes were in foreclosure inventory. Nationally, the number of loans in the foreclosure inventory decreased by 145,000, or 9.5 percent in January 2012 compared to the previous year.

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The foreclosure inventory is the stock of homes in the foreclosure process. A property moves into the foreclosure inventory when the mortgage servicer places the property into the foreclosure process after serious delinquency is reached and remains there until the foreclosure is completed.

In total, the number of completed foreclosures for the previous twelve months was 860,128. From September 2008, the start of the economic crises, there have been approximately 3.3 million completed foreclosures.

""We are encouraged by the noticeable progress we are seeing over the last several months in the mortgage industry,"" said Anand Nallathambi, CEO of CoreLogic. ""During the last several years, the industry has faced enormous challenges working through difficult and complex issues. We are hopeful that these recent improvements are early signals of revitalization in the mortgage market.""

The share of borrowers nationally that were more than 90 days late on their mortgage payment, including homes in foreclosure and REO, decreased to 7.2 percent in January 2012, compared to 7.8 percent a year ago, but remained unchanged compared to December 2011.

*Five states with the largest number of completed foreclosures over 12 months as of January 2012*

California (155,000), Florida (86,000), Arizona (65,000), Michigan (65,000), and Texas (57,000)

_These five states account for 49.7 percent of all completed foreclosures nationally._

*Five judicial states with the highest percentage of foreclosure inventory*

Florida (11.8 percent), New Jersey (6.4 percent), Illinois (5.3 percent), Maine (4.3 percent), and Connecticut (4.2 percent)

*Five non-judicial states with the highest percentage of foreclosure inventory*

Nevada (5 percent), New York (4.7 percent), Kentucky (2.8 percent), Oregon (2.8 percent), and Mississippi (2.7 percent)

*Five states with the highest foreclosure rates*

Florida (11.8 percent), New Jersey (6.4 percent), Illinois (5.3 percent), Nevada (5.0 percent), and New York (4.7 percent)

*Five states with the lowest foreclosure rates*

Wyoming (0.7 percent), Alaska (0.8 percent), North Dakota (0.8 percent), Nebraska (1.1 percent), and Texas (1.3 percent)