Total mortgage foreclosures in Erie County fell to their lowest levels in at least five years in both July and August, defying the national trend and pundits, as figures for all of 2009 head toward a fourth straight year of lower home seizures.
According to figures from the Erie County clerk's office, actual completed foreclosures for the first eight months of the year are down 35 percent from 2005, to 930, while the initial foreclosure filings, known as lis pendens, are down 15 percent from 2008 and 20 percent from 2005, to 1,751.
Moreover, Erie County Clerk Kathleen C. Hochul said the third quarter of 2009 is "on track" to have the lowest foreclosure rate for the county since 2004. Total foreclosures in both July and August equaled 159, down 40 percent from a year ago, so September would have to post 138 by itself to equal the next lowest quarterly level of 297, from the fourth quarter of 2008. But only two months this year have gone that high.
Finally, the tallies of 79 for July and 80 for August are the lowest totals of any month since at least 2004. Indeed, only five months since then have seen tallies below 100.
"Not only did Erie County weather this particular cloud during the national economic storm, the local forecast continues to improve for existing homeowners," Hochul said by e-mail.
A separate report by the Western New York Law Center examined individual properties affected by foreclosure, instead of just filings, since refilings sometimes occur. According to the law center, 424 residential properties had foreclosures filed on them in the third quarter.
That's down 23.7 percent from 556 in the second quarter and down 26.8 percent from a year ago. And it's the second-lowest total for any quarter since at least 2006. Only the last quarter of 2008 was lower, at 329, because New York state's new requirement took effect for a 90-day notice before commencing foreclosure.
Commercial foreclosures were a little more mixed, with 21 properties affected in the third quarter of 2009. That's up from 13 in the second quarter, but down from 36 a year ago.
Kathleen Lynch, senior attorney at the law center, attributed the drop to efforts by the federal government and the mortgage and banking industries to stem the tide of foreclosures and keep people in their homes. That's in stark contrast to the frequent criticism by housing counselors, consumer advocates and others that the industry and government weren't doing enough before to modify loan terms to make them more affordable for the long-term.
In particular, under the Obama administration's Making Homes Affordable plan, which started March 4 and seeks to help 7 million to 9 million homeowners stay in their homes, participating lenders are supposed to review loans to see if they qualify for modifications before starting foreclosure on them.
"Our experience has been that, though it was a little slow in getting going, we saw more participation by servicers and review of loans over the summer months," Lynch said. "We are getting loan modifications. All in all, I think the drop is a positive reflection on the efforts."
Lynch also said that, among three local housing counseling agencies she has contacted, between 70 percent and 90 percent of the clients contact them for help even before they receive the first foreclosure filing. "This is good, and seems to indicate that homeowners are seeking help early in the process," she said.
Nationwide, however, conditions were not so good. Foreclosure activity remained near record levels in August, dropping less than 1 percent from the record high in July, according to national research firm RealtyTrac, of Irvine, Calif. It also was up 18 percent from a year earlier, despite a drop from August 2008 in "real estate owned" (REO), or foreclosed properties on lenders' balance sheets.
According to RealtyTrac's monthly report, filings including default notices, scheduled auctions and bank repossessions were reported on 358,471 properties in August, with one in every 357 U.S. housing units getting a foreclosure notice that month.
"There is still an ample supply of properties filling the foreclosure pipeline even while the outflow of bank-owned REO properties onto the resale market is being more carefully regulated," RealtyTrac CEO James J. Saccacio said in a news release. "We also saw a record high number of properties either entering default or being scheduled for a public foreclosure auction for the first time."
Nevada continued to suffer the worst, with one of every 62 housing units, or 17,902 properties, getting a foreclosure notice in August. That's down 8 percent from July, but up 53 percent from a year earlier.
Florida was No. 2, with one in every 140 homes, followed by California, with one in every 144 homes affected. Filling out the top 10 states were Arizona, Michigan, Idaho, Utah, Colorado, Georgia and Illinois. Nevada, California and Florida also held all 10 of the top metro areas, led by Las Vegas.
New York had 5,350 filings in August, including 3,947 lis pendens but only 537 properties actually seized. That means one of every 1,484 homes had a foreclosure filing in the state.