New foreclosure starts rose sharply in August, signaling a slew of foreclosed properties will be dumped on the already bloated housing market in early 2012.
"Notices of Default," the first stage of the foreclosure process, rose 33 percent month-to-month, according to a new report from RealtyTrac.
Much of this was driven by a huge jump in the numbers from Bank of America , as reported here on the blog Tuesday.
“The big increase in new foreclosure actions may be a signal that lenders are starting to push through some of the foreclosures delayed by robo-signing and other documentation problems,” said James Saccacio, chief executive officer of RealtyTrac. “It also foreshadows more bank repossessions in the coming months as these new foreclosures make their way through the process.”
As always, the numbers vary locally, with default notices up more than 40 percent month-over-month in New Jersey (42 percent), Indiana (46 percent) and California (55 percent). The numbers are still down from August of 2010, but that was a near-record high month before any of the "robo-signing" documentation problems were uncovered.
While the jump is significant, it may just be the tip of the iceberg.