Home Foreclosure News of the Day: Is the Housing Crisis Finally Coming to an End? The Answer May Surprise You


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Lately, foreclosure numbers have been declining. But, many housing experts have pointed out that it’s not because the housing market is getting better, but for other reasons, ie:

3 Reasons Foreclosure Numbers are Declining but the Housing Crisis Rages On

Legislation: Many lenders stopped foreclosing on homes last fall due to Attorney Generals around the nation taking action against cries of illegal foreclosures, which leads us to the next reason . . .

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RoboSigning Scandal:  Many of the illegal foreclosures were due to this, where banks didn’t have the proper authority to foreclose. 

Backlog: Because of the above, many banks are simply backlogged and can’t get around to foreclosing on homeowners who should have long ago been served with a foreclosure notice.

So, this is why even though foreclosures have been decreasing, experts have warned – don’t celebrate. It’s a faux housing recovery.

Home Foreclosure Statistic: Foreclosures Decrease by 35% from a Year Ago

However, recent numbers by RealtyTrac say the end of the foreclosure crisis may finally have some legs; that it might be the real thing. The Bloomberg.com article, Have Home Foreclosures Finally Hit A Peak?: The Ticker, states:

. . . today’s number, showing a 35 percent decline in July [2011] from a year earlier — the lowest level in almost four years — may have convinced RealtyTrac that the downward trend is more than a paperwork logjam. The processing delays, “combined with the smorgasbord of national and state-level foreclosure prevention efforts,” RealtyTrac CEO James Saccacio said in a statement, “may be allowing more distressed homeowners to stave off foreclosure.” 

Is This Another Faux Housing Recovery?

In spite of this good news, housing experts still place a caveat on a housing recovery.

Why?

Two words – shadow inventory.

The linked to Bloomberg.com article above notes:

Even if foreclosures are declining, that doesn’t mean the housing market is about to get better. The shadow inventory of homes that are vacant and held off the market remains formidable. 

Just how many homes make up this type of inventory? Get a State by State Estimate of Shadow Inventory

Bottom line: The foreclosure crisis rages on – but like a storm, we may finally be at the beginning of the end. But, it’s still gonna be a few years before home values start to climb again – and many may never reach the values they had before the foreclosure crisis kicked off in earnest in the fall of 2007.

Related Posts

Home Foreclosure News: Why Home Prices May Be Depressed for Some Years to Come & What It Means for the Average Homeowner

Some Banks are Purposely NOT Foreclosing on Homeowners in Default: Here’s Why

Foreclosure Statistics: 4 Reasons Home Foreclosures are Suddenly Declining

P.S.: Bank Failures Can Mean Big Business for Foreclosure Cleaning Businesses! Learn which banks closed have closed recently. Then, learn how to use bank failures to grow your foreclosure cleaning business.

P.P.S.: Like this post? Follow Foreclosure Business News on Twitter.

Copyright © 2011 Yuwanda Black for Foreclosure Business News. Article may not be reprinted or reproduced in any manner without the express, written consent of the author.

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