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National Foreclosure Inventory Falls Year Over Year in February

Decline Experienced in All States

Molly Boesel    |    Mortgage Performance

  • The foreclosure inventory fell nearly 24 percent year over year in February 2016.
  • The seriously delinquent inventory fell almost 20 percent year over year in February 2016.
  • All states except North Dakota had a decrease in the seriously delinquent rate, but the increase was minimal.

The national foreclosure inventory – the number of loans in the foreclosure process – fell 23.9 percent year over year in February 2016, according to the latest CoreLogic Foreclosure Report. The foreclosure inventory has fallen on a year-over-year basis every month since November 2011 (Figure 1) and in February 2016 it was 72.2 percent below the January 2011 peak.

The foreclosure rate – the share of all loans in the foreclosure process – fell to 1.1 percent in February 2016, down from 1.5 percent in February 2015. While the foreclosure rate is back to 2007 levels, it is still above the pre-housing-crisis average foreclosure rate of 0.6 percent between 2000 and 2006.

Judicial Foreclosure

Judicial Foreclosure

Figure 2 shows that, collectively, judicial foreclosure states[1] continued to have a much higher average foreclosure rate (1.9 percent) in February 2016 than non-judicial states (0.6 percent). The collective foreclosure rate in non-judicial states is close to the pre-crisis rate of 0.4 percent, while the foreclosure rate in judicial states is more than double the pre-crisis rate of 0.8 percent. As of February 2016, judicial states had 42 percent of the nation’s outstanding mortgages but 70 percent of all loans in foreclosure.

All states and the District of Columbia posted year-over-year declines in their foreclosure inventory in February 2016, and 20 of those had decreases of more than 20 percent. The five states with the largest year-over-year drop in their foreclosure inventory were Florida (-37.6 percent), Michigan (-33.8 percent), Tennessee (-33.4 percent), Nevada (-32 percent), and Minnesota (-30 percent).

The seriously delinquent rate – the share of loans 90 or more days overdue – was 3.2 percent in February 2016, down from 4 percent in February 2015. The February 2016 inventory of seriously delinquent mortgages fell 19.9 percent year over year. The seriously delinquent rate fell year over year in all states except North Dakota, where it increased by 0.1 percentage points.



1 In judicial foreclosure states, lenders must provide evidence of delinquency to the courts in order to move a borrower into foreclosure. In non-judicial foreclosure states, lenders can issue notices of default directly to the borrower without court intervention. This is an important distinction since judicial foreclosure states have longer foreclosure timelines, thus affecting foreclosure statistics.

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