US Foreclosures Fell in April, Signaling Improvement

Foreclosures in the US fell by more than 2 percent in April from a year earlier, the first year-over-year decline in the five years RealtyTrac has been reporting the data.

Getty Images Foreclosures fell 2.4 percent in April from a year earlier, the first time the rate has decreased on a year-to-year basis.

The number of Americans receiving foreclosure notices was down 2.4 percent in April from a year before and 9 percent lower than March 2010.

Experts say the foreclosure situation is slowing, and may have hit a plateau.

“I think you shouldn’t read to much into a one month dip, even if it is the first time,” said Rick Sharga, senior vice president of RealtyTrac. "It really isn’t that we’re out of the woods. Its more of a process issue," he said, explaining that lenders are working through a backlog of troubled properties.

In all, one in every 387 homes in America received a foreclosure notice, which is defined as a notice of default, auction sale or bank repossession.

“The data is starting to indicate that it is stabilizing,” said housing analyst Patrick Newport of IHS Global Insight. He cited Fannie Mae’s

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[FNM  Loading...      ()   ] first-quarter results released Monday, which indicated that single-family mortgage delinquencies were starting to slow down.

“Although our single-family serious delinquency rate increased during the first quarter of 2010 and remains high, our single-family serious delinquency rate grew at a much slower rate during the first quarter of 2010 than during each quarter of 2009,” Fannie Mae said in its filing.

While the foreclosure rate dropped, the RealtyTrac data shows that bank repossessions—also known as real estate owned, or REO—hit a record high in April; a total of 92,432 homes that were taken back by the lender. That’s a 1-percent increase from the previous month and a 45- percent increase from April 2009.

“If we start creating jobs, I think the situation will start getting better,” said Newport.

The ten states with the highest foreclosure rates were little changed from the previous month. According to the RealtyTrac report, Nevada remains No. 1 for the 40th straight month, with one in every 69 properties in the state getting a foreclosure notice.

Arizona ranked second with one in every 169 households receiving a notice, followed by Florida (one in 182 households), California (one in 192 households) and Utah (one in every 221 households.)

Vermont had the lowest rate, with one in every 26,051 properties receiving a foreclosure notice.

• Slideshow: Highest State Foreclosure Rates