Few signs of any looming foreclosure wave emerged in May, although filings edged up 9% from a month earlier, according to a new report.
Banks filed foreclosure paperwork—default notices, scheduled auctions and bank repossessions — on 205,990 American homes in May, according to the report by data firm RealtyTrac. That was down 4% from May 2011, the 20th consecutive month of year-over-year decreases.
RealtyTrac Chief Executive Brandon Moore said most new foreclosure starts probably would end up as short sales or auctioned off to other buyers, not remain on banks’ books.
“It’s going to be a bumpy ride down to the bottom of this foreclosure cycle,” Moore said. “More banks are now recognizing that treating the problem of delinquent mortgages with short sales rather than bank repossessions can help them minimize their losses and also avoid taking on more [bank-owned homes], which they then have to manage, maintain and market for sale.”