Foreclosures continue to ebb

Filings declined sharply nationwide in 2014, but Oregon’s rate rose as homes worked through process

By Alex Veiga

The Associated Press

For Sale SignA healthier U.S. housing market and economy helped to winnow foreclosures nationally in 2014 to levels not seen since before the housing bust.

The decline is the latest evidence of how foreclosures have diminished in recent years from a national crisis to a largely market-­specific concern.

While foreclosures declined in most of the country last year, Oregon was one of nine states where foreclosure filings increased, by 5 percent, with the biggest increases being in Eastern Oregon, according to RealtyTrac­, a California firm that tracks foreclosures nationwide.


Locally, 827 Lane County properties received some sort of foreclosure filing in 2014, double the previous year, according to date released Thursday by RealtyTrac.

Eugene-based Gorilla Capital said that historically it sees a decrease in foreclosures in Oregon in December, but this year it saw an increase in the 24 Oregon counties it monitors.

“December’s filings reflect what we have believed for many months, that monthly foreclosure filings will continue to hover most months near the 600-plus mark, and may be even increase during the first quarter of 2015,” said John Helmick, CEO of Gorilla Capital.

“Oregon’s foreclosure process keeps many foreclosed homes at the front-end of the filing process for months, and sometimes years, inadvertently creating vacant or ‘zombie’ homes that drag down values in thriving neighborhoods,” he said.

While foreclosures nationally also remain elevated in many large metropolitan areas, such as New York, Philadelphia and San Diego, they have declined annually overall in recent years, according to RealtyTrac.

The number of homes in the United States that were repossessed by banks fell 29 percent last year to the lowest level since 2006, a year before the subprime mortgage crisis erupted, according to RealtyTrac data.

One reason for the drop: fewer homes entered the foreclosure process last year.

Foreclosure starts tumbled 14 percent versus a year earlier to the lowest level since 2006, the firm said.

“Foreclosures are no longer a threat to home values nationwide,” said Daren Blomquist, a vice president at RealtyTrac.

All told, 643,193 U.S. homes entered the foreclosure process last year, according to RealtyTrac. That represents a 70 percent drop from their 2009 peak of about 2.14 million homes.

Completed foreclosures, or homes that were taken back by lenders, fell to 327,069. That’s down 69 percent from their peak of 1.05 million five years ago.

U.S. home sales slumped much of last year after a three-year rebound.

Nearly 1.5 million homes returned to positive equity — when a home is valued at more than what the owner owes on the mortgage — in the 12 months ended Sept. 30, according to CoreLogic. Some 5.1 million homes, or 10.3 percent of all homes with a mortgage, remained in negative equity — when the value of a home falls below what is owed on the mortgage — as of Sept. 30, the firm said.

While fewer homes entered foreclosure last year, they rose on an annual basis in December for the second month in row.

The increase stemmed largely from home loans that were made between 2004 and 2008, before banks tightened lending standards. Many of those mortgages represent loans gone unpaid for years that are only now entering the foreclosure path, often because of logjams in states such as Oregon where the courts play a role in the foreclosure process.

“This foreclosure market is normalizing, but it’s still heavily skewed to the bubble years,” Blomquist said.

— Business Editor Ilene Aleshire contributed to this story.

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