Foreclosure activity continues to slow throughout the United States.

According to data from RealtyTrac, a national foreclosure-tracking firm, the number of foreclosure filings dipped below 215,000 in September 2011, a 6 percent decrease from August.

A “foreclosure filing” is defined as any foreclosure-related action including Notice of Default, Scheduled Auction, or Bank Repossession.

September marks the 12th straight month in which foreclosure filings fell year-over-year.

There are several reasons why foreclosure filings are down, including an increase in the amount of time it takes banks to move a foreclosure through its pipeline. It now takes a nationwide average of 336 days from the date of initial default notice to bank repossession.

Some states work quicker than others, however, because of a combination of state law and personnel.

Homes in New York take an average of 986 days to foreclose, for example, the longest in the country. Homes in Texas foreclose the quickest, registering just 86 days.

As in prior months, bank repossessions remain concentrated by state. Just 6 states accounted for half of the country’s REO last month:

• California : 16.6 percent
• Georgia : 8.5 percent
• Florida : 8.3 percent
• Texas : 6.2 percent
• Michigan : 6.1 percent
• Illinois : 5.2 percent

Collectively, these 6 states represent just 36 percent of the nation’s population.

By contrast, the bottom 6 states were home to just 192 repossessions last month — 0.3% of the national total. Those 6 states were Alaska, Wyoming, District of Columbia, North Dakota, South Dakota, and Vermont.

For home buyers in Mauldin , shopping for foreclosed properties can be an excellent way to get “a deal”. Foreclosed homes typically sell at discounts as compared to “non-foreclosed” homes, but are often sold “as-is”. This means that homes listed for sale may be defective or out-of-code.

Before placing a bid on a foreclosed home, make sure that you’re represented by an experienced real estate professional. 

Prices have risen more than 3% since May, according to S&P/Case-Shiller.

But most forecasts predict price declines in 2010, with possible losses ranging from anywhere from 3% on up. Fiserv Lending Solutions, a financial analytics firm, forecasts that prices will fall in all but 39 of the 381 markets it covers, with an average drop of 11.3%.

“We’ve seen recent price stabilization because of low mortgage interest rates and the impact of the first-time homebuyers tax credit,” said Pat Newport of IHS Global Research. “But there are really good reasons to think prices will now start going down.”

There are three main reasons for the reversal: a coming flood of foreclosures, rising interest rates and the eventual end of the tax credits.

For Gus Faucher, the director of macroeconomics for Moody’s Economy.com, the huge number of foreclosures that remain in the pipeline is the big problem.

Moody’s upped its estimate of defaults recently because of shortcomings of the government-led mortgage modification programs. Trial workouts are not being made permanent and completed modifications are redefaulting at high rates.

“There are going to be fewer [successful] modifications than we thought,” said Faucher.

Even so, he added, much of the price decline has already occurred and Moody’s forecast is for only another 8% drop. The worst-hit markets will be the ones suffering the most foreclosures, places like Arizona, California, Florida and Nevada. (See 7 tips for buying foreclosures)

Resetting option ARMs (adjustable rate mortgages) will also aggravate the foreclosure problem. These mortgages allow borrowers to pick their own payments, which can be so low they don’t even cover the interest. Balances swell.

For many of the more than 350,000 option-ARM borrowers, it’s time to pay the piper. Their loans will change into fully amortizing mortgages that will carry much higher monthly payments. A very large percentage of these homeowners will default, according to Shari Olefson, author of “Foreclosure Nation: Mortgaging the American Dream.”

“We’ve still only seen the tip of the foreclosure iceberg,” she said.

She also predicts more strategic defaults, people deliberately walking away from even fixed-rate mortgages as the value of their homes dips well below the amount they owe.

Olefson’s forecast is for price declines of 5% to 15%, depending on the area, with a national median price drop of about 10% for 2010.

Also affecting prices will be higher interest rates. Some analysts, according to Newport, think rates for a 30-year mortgage will pass 6% next year as the government curtails housing market support.

The Federal Reserve has helped keep rates low through purchases of mortgage-backed securities. But that program is winding down and will end in March.

“The government is throwing everything at the market but the kitchen sink,” said Peter Schiff, president of Euro pacific Capital. “It can’t prop up housing markets forever.”

Schiff is among the bigger bears. Though he gave no specific prediction, he thinks prices — already down 29% from the peak — are only halfway to the bottom.

As a tool for supporting housing markets and prices, the tax credit for homebuyers is a two-edged sword. It reduces taxes dollar-for-dollar by up to $8,000 for new homebuyers and $6,500 for buyers who already own a home and should support home prices. But it ends at the end of April.

Many buyers will push their deals forward to get in before the deadline and then demand for homes could sink afterward.

One of the few bulls out there is NAR, whose chief economist, Lawrence Yun, is counting on the tax credit to provide temporary support for housing markets until the economy recovers enough to start fueling sales. He predicts price improvement in 2010 of more than 3%.

“The headwind we face is rising mortgage interest rates,” Yun said, “but the compensating factors will be the homebuyers tax credit in the first half of the year and increased job creation in the second half.”

All of this means, now is the time to buy!  To talk to a mortgage manager, call 864-979-1111 and ask for Gary Schoenholz (15 years of mortgage experience) or go to my website: www.GaryTheMortgageExpert.com.

Experts believe there a several reasons for this drop but the main reasons for the drop are the approaching holiday season, the government’s modification programs and the mandatory mediation in more states between homeowners and lenders before going to foreclosure.

For example Nevada saw its foreclosure rate drop 33% from the month before but the state still leads the country in foreclosures with one in every 119 homes receiving a notice. Florida ranked second, followed by California, Arizona and Idaho. The state with the lowest rate of foreclosure was Vermont.

Though the numbers are encouraging to see there most experts believe this is going to remain a problem in the economy for some time to come.

Posted by Randy Ratchford…Randy can be reached toll free 877-627-9211 ext107 or by email RRatchford@HorizonFinancial.org

An example would be as follows: you originally purchased your home for $200k and obtained a 1st mortgage for $160k which would be 80% loan to value, but now the value of your home has fallen to $180k. You could still refinance but in order to obtain a mortgage this scenario would require Private Mortgage Insurance. Th Home Affordable Program is designed for this scenario, as long as your current mortgage is a Fannie Mae or Freddie Mac loan you can obtain the going rate with no PMI. 

The program will also allow you to obtain the going rate with no PMI if you have a 2nd mortgage as well. As long as your current 1st mortgage originally had no PMI you can have the current 2nd subordinated to stay in 2nd lien position and take advantage of the lower rates.

Due to the loss of home prices over the past 2 years and increasing foreclosure problem this program was designed to help the borrower who simply wants to take advantage of the lower rates but otherwise would not be able to do so. If you are wondering if you are a candidate for this program all you have to do is contact your mortgage professional and give your address and you can find out in minutes if you qualify.

Rates are still at an all time low and if you have been hesitant about the thought of refinancing due to a loss of home value, this program may be able to help you lower your rate and monthly payment. Consult your mortgage professional today.

Posted by Randy Ratchford Partner/ Mortgage Planner with Horizon Financial, Inc. Randy can be reached toll free 877-627-9211 ext107 or email RRatchford@HorizonFinancial.org

Foreclosures are still concentrated in 4 states.

According to RealtyTrac.com, a foreclosure tracking company, more than 50% of foreclosure-related actions in August occurred in just four states:

• California : 25.76%
• Florida : 17.4%
• Michigan :  5.4%
• Nevada : 5.0%

The rest of the “Top 10″ included Arizona, Illinois, Georgia, Ohio, Texas and New Jersey.

Foreclosures are up 18% compared to August 2008.

Good news?  Sort of.  High foreclosure rates are providing  tremendous opportunities for today’s home buyers. Buyers of distressed properties now account for about one-third of all home sales and low mortgage rates and a federal tax credit are spurring sales.

Posted by Scott Fowler.  Scott can be reached toll free @ 877-627-9211 x 104 or email SFowler@HorizonFinancial.org.   www.ScottFowlerTeam.com

For the 4rth straight month, foreclosure activity was dominated by 3 states.

As reported by RealtyTrac.com, more than 50% of foreclosure-related actions in June were in California, Florida and Nevada.

Others in the Top 10 include Arizona, Georgia, Michigan, Texas, Ohio, Illinois and Colorado.

June’s foreclosure figures are consistent with data from earlier this year, suggesting the foreclosure remedy plans put forth by the government and by lenders can barely keep pace with the national default rate.

Foreclosure-related actions nationwide are up 5% from May.

The silver lining in data this negative is foreclosures are creating tremendous buying opportunities for the right buyers.  Because foreclosed homes tend to sell at a discount versus non-foreclosed homes and because mortgage rates are low, home sales are showing strength in a multitude of markets because of ample supply at relatively cheap prices.

Distressed homes accounted for one third of all existing home sales in May.

Search the complete June 2009 foreclosure report for yourself, including foreclosure heat maps and other trends on the RealtyTrac website.

Posted by Scott Fowler.  Scott is a Partner / Sr. Loan Officer with Horizon Financial.  Scott can be reached toll free @ 877-627-9211 x 104 or email SFowler@HorizonFinancial.org.      Visit Scott’s website @ www.ScottFowlerTeam.com .