It is possibly the nastiest consequence of the holiday season. Foreclosures rise now, as banks try to get ahead of the traditional December moratoriums, when they suspend all foreclosures due to the holidays.
No lender wants to take a house back during the holidays, but it appears to be particularly bad now for a number of reasons.
Newly started foreclosures rose 12 percent in October from September, according to a new report from RealtyTrac, a foreclosure listing company. That is the largest monthly increase since August 2011, and more than twice the gain from September to October in the last five years. Just over 48,000 properties started the process in October, still 14 percent less than a year ago.
Foreclosures have been declining steadily for the past several years, with more than 6 million homes lost since 2008. Part of the annual increase this year could be due to already troubled loans that were modified but are now re-defaulting. More than half (57 percent) of new foreclosures in August were re-defaults, according to Black Knight Financial Services, the largest share of repeat foreclosures on record. That is likely continuing into October's numbers.