The Blog Site for SCP Appraisal Service

Foreclosure activity in the United States set a new record in the third quarter of 2009 with one in every 136 housing units receiving a foreclosure filing, increasing 5 percent from the previous quarter and 23 percent from the third quarter of 2008, according to RealtyTrac Inc.

Despite government and lender efforts to assist struggling homeowners, foreclosure filings – including default notices, scheduled auctions and bank repossessions – were reported on 937,840 properties in the third quarter. That marked the highest quarterly foreclosure rate since RealtyTrac began issuing its reports in 2005.

“REO activity increased from the previous quarter in all but two states and the District of Columbia, indicating that lenders may be starting to work through some of the pent-up foreclosure inventory caused by legislative delays, loan modification efforts and high volumes of distressed properties,” James Saccacio, chief executive officer of RealtyTrac, said in a news release.

Nevada once again topped the list as the state with the most foreclosures with one in 23 housing units receiving a filing – nearly six times the national average. Foreclosure filings in Nevada totaled 47,925 properties, representing a 10 percent increase from the previous quarter and a 59 percent increase from a year ago.

Arizona and California were tied for second place with one in every 53 housing units receiving a foreclosure filing. Arizona increased 5 percent from the previous quarter and 24.55 percent from a year ago while California decreased 1.5 percent from the previous quarter and 18.60 percent from a year ago.

California, Florida, Arizona, Nevada, Illinois and Michigan accounted for 62 percent of the nation’s total foreclosure activity in the third quarter, having a combined total of 579,541 properties receiving a filing, according to RealtyTrac’s report.

Vermont had the lowest foreclosure rate in the U.S. with one in 5,023 housing units receiving a notice in the third quarter despite its foreclosure rate surging 170 percent compared with the third quarter of 2008. North Dakota had the next lowest rate with only one in 2,724 units receiving a notice.

Home foreclosures are expected to climb through late 2010 as unemployment continues to increase. “The number of people who can’t pay their mortgages, we haven’t seen the peak of that,” David Lowman, head of JPMorgan Chase & Co.’s mortgage unit, told Bloomberg. “That’s going to weigh on us for some time to come.”

According to industry experts, the fastest growing area is in the 180 days-plus late category, the most seriously delinquent borrowers. “It’s going to be a lingering problem,” said RealtyTrac spokesperson Rick Sharga.