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Foreclosure Report Highlights: June 2016

National Foreclosure Inventory Down 26 Percent Year Over Year

Molly Boesel    |    Mortgage Performance

  • The foreclosure inventory fell 26 percent year over year in June 2016.
  • The inventory of mortgages in serious delinquency fell 21 percent year over year in June 2016.
  • All states except North Dakota had a year-over-year decrease in the serious delinquency rate, but the increase was minimal.

The national foreclosure inventory – the number of loans in the foreclosure process – fell 25.9 percent year over year in June 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 June 2016 it was 76 percent below the January 2011 peak.

The foreclosure rate – the share of all loans in the foreclosure process – fell to 1 percent in June 2016, down from 1.3 percent in June 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 FCL States Cont to have Higher FCL Rates

Judicial FCL States Cont to have Higher FCL Rates

Figure 2 shows that, collectively, judicial foreclosure states[1] continued to have a much higher average foreclosure rate (1.6 percent) in June 2016 than non-judicial states (0.5 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 two times the pre-crisis rate of 0.8 percent. As of June 2016, judicial states had 42 percent of the nation’s outstanding mortgages but 70 percent of all loans in foreclosure.

North Dakota (7.4 percent) and Alaska (0.3 percent) were the only states in June 2016 to post a year-over-year increase in foreclosure inventory. The foreclosure rates in both of these states remained low, however.

The serious delinquency rate – the share of loans 90 or more days overdue – was 2.8 percent in June 2016, down from 3.6 percent in June 2015. The June 2016 inventory of mortgages in serious delinquency fell 21.3 percent year over year and was 70.3 percent below peak. The serious delinquency rate fell year over year in all states except North Dakota, where it rose from 0.9 percent in June 2015 to 1.0 percent in June 2016.



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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