Occupy movement protesters move furniture into a family's foreclosed… (Allen J. Schaben / Los Angeles…)
Foreclosure activity in the first quarter in the U.S. fell to its lowest level in more than four years despite predictions that a new wave of distressed homes would flood the market this year.
Foreclosure filings in the first quarter were down 2% from the fourth quarter of 2011 and 16% from the same period last year. An estimated 572,928 properties received foreclosure filings during the quarter, the lowest total since the fourth quarter of 2007, according to Irvine data firm RealtyTrac.
Sean O’Toole, founder of the website ForeclosureRadar, said the biggest factor holding back foreclosures is politics. Banks are trying to repair their images after the mortgage mess and the Obama administration is in general election mode. He said foreclosures will remain in a lull and that any sharp uptick is unlikely.
“The chances are zero,” O’Toole said. “If you take into account the political and bank issues, there is just no chance of it.”
Several factors could be keeping a lid on foreclosures, experts have said. Banks have learned how to manage their foreclosure inventory better, new incentives to do loan modifications have been added by the Obama administration, the Federal Reserve is pushing a plan to convert distressed homes into rental properties and the economy is haltingly adding jobs.
Economists and analysts had predicted that the chief result of a $25-billion foreclosure settlement between state attorneys general and the nation’s biggest mortgage servicers would be a resurgence in foreclosure activity. Although there was a spike last summer in certain Western states as a deal appeared imminent and a more recent uptick in other jurisdictions, the overall numbers have remained suppressed.
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