Foreclosures in Hampton Roads spiked last month, defying national trends, as banks picked up the pace of repossessing and auctioning off delinquent properties, according to a report to be released today.
There were 1,225 foreclosure-related notices in July, up 12 percent from June and up less than 1 percent from the level a year ago, according to RealtyTrac, an online foreclosure-monitoring service based in Irvine, Calif.
It's the first time since November that the number of foreclosures has risen year-over-year, albeit marginally. The number of foreclosures had steadily declined year-to-year from December through June.
Real estate experts had attributed the declines in foreclosures to bank processing delays rather than an improvement in the financial stability of mortgage borrowers.
"It appears that the foreclosure processing delays, combined with the smorgasbord of national and state-level foreclosure-prevention efforts - including loan modifications, lender-borrower mediations, and mortgage payment assistance for the unemployed - may be allowing more distressed home-owners to stave off foreclosure," James J. Saccacio, RealtyTrac's CEO, said in a news release.
He said those efforts will likely push the foreclosure problem into next year.
"A stabilizing economy and improving job market are the long-term keys to a housing market recovery," he said.
James Koch, an economist at Old Dominion University, said falling home prices in the region also could be exacerbating foreclosures.
"You have more and more people going underwater, and I think it's not out of the question that more of those people are allowing themselves to be foreclosed on," he said. "Until the housing market starts to improve, I think we'll see a continuing of foreclosures."
The jump in foreclosure activity in Hampton Roads ran counter to trends across the country, where foreclosures fell 4 percent from June and were down 35 percent from a year earlier, RealtyTrac reported. It was the 10th consecutive month that foreclosures nationwide had fallen from their levels a year earlier. The national data include notices of default, the first stage of the foreclosure process after a homeowner has missed mortgage payments.
Dotty Acampora, a foreclosure prevention counselor at the nonprofit Virginia Beach Community Development Corp., said banks seem to be processing foreclosures much faster than they were a year ago.
"It's definitely a mixed bag," she said. "On one hand, they seem to be doing more outreach, but the minute someone gets turned down for a modification for a missing document or something, the banks are expediting the foreclosure process."
The demand for foreclosure prevention counseling tapered off slightly a few months ago, but in recent weeks has returned to its previous levels, Acampora said.
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