Foreclosures Booming in First Quarter of 2009.(Managing REO)

Byline: Jennifer Harmon

Irvine, CA-Foreclosure activity is picking up again following initiatives by national and state lawmakers to save borrowers and stop massive amounts of properties from moving into foreclosure and REO.

Foreclosure filings were reported on 803,489 properties in the first quarter, a 9% increase from the fourth quarter of 2008 and an increase of nearly 24% from the first quarter of 2008, according to the latest U.S. Foreclosure Market Report from RealtyTrac here.

Filings were reported on 341,180 properties in March, up 17% from February and 46% from March 2008, despite a decrease in bank repossessions or real estate-owned assets, which were down 13% from the fourth quarter of 2008 and 3% from February totals.

Since much of the March activity was in new foreclosure actions, it suggests that many lenders and servicers were holding off on executing foreclosures due to industry moratoria and legislative delays, according to James Saccacio, chief executive officer of RealtyTrac.

"The drop in REO activity can be attributed to these processing delays, rather than to any of the foreclosure prevention programs currently in place," said Mr. Saccacio. "It's very likely that we'll see the number of REOs increase again now that most of the moratoria have been lifted."

On a positive note, he believes demand is up in some of the harder-hit areas, particularly on bank-owned REO properties that first-time homebuyers and investors see bargains in. "But it's unlikely this increased demand will be enough to offset the growing number of foreclosures in the pipeline, accelerated by rising ...