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8 FORECLOSURE INVENTORY CONTINUES TO DWINDLE e nation's foreclosure inventory and number of completed foreclosures continued their steady downward spiral in January, according to CoreLogic's latest National Foreclosure Report. Foreclosure inventory, which is the number of residential homes that are in any stage of foreclosure, took a plunge of 33.2 percent year- over-year in January, down to 549,000 compared to 822,000 in January 2014. Foreclosure completions totaled about 43,000 in January—a decline of 22.5 percent from the same month a year earlier, when 55,000 foreclosures were completed. By comparison, completed foreclosures, which are a true sign of homes lost to foreclosure, averaged about 21,000 per month nationwide from 2000 to 2006 in the years prior to the financial crisis. While January's total was still more than double that average, much progress has been made in the last three years— completed foreclosures have declined each month for the past 37 months. Completed foreclosures have totaled approximately 5.5 million nationwide since the height of the financial crisis in September 2008 and have totaled approximately 7 million since homeownership peaked in the second quarter of 2004. January's foreclosure rate of 1.4 percent— meaning 1.4 percent of all residential homes with a mortgage nationwide are in some state of foreclosure—was the lowest level reported since March 2008. Year-over-year, the foreclosure rate was down 0.6 percentage points, from 2.0 percent reported in January 2014. e number of mortgages that were seriously delinquent in January, those defined as 90 or more days past due or in foreclosure or bank- owned, was reported at 1.53 million (4 percent of all mortgages), a year-over-year decline of 23.8 percent and its lowest level since June 2008. "Job growth and home-value appreciation have worked to push the serious delinquency rate to the lowest since mid-2008 and foreclosures down by one-third from a year ago," said Frank Nothaft, chief economist at CoreLogic. "With economic growth in 2015 expected to be better than last year, further declines in both delinquencies and foreclosures are projected for this year." While 36 states reported a level of foreclosure inventory below the national average of 1.4 percent in January, the rate remained high in some states—namely in judicial states where the foreclosure process has to pass through the courts, according to CoreLogic's January 2015 National Foreclosure Report . e foreclosure rate in judicial states was more than triple the rate in non-judicial states in January (2.4 percent compared to 0.7 percent, according to CoreLogic). New Jersey, a judicial foreclosure state, led the pack in foreclosure rate with 5.2 percent of all residential homes with a mortgage in some stage of foreclosure during January. Second was New York, another judicial foreclosure state, with 4.0 percent. Two more judicial foreclosure states, Florida and Hawaii, were third and fourth with 3.5 percent and 2.7 percent, respectively. District of Columbia, which is non-judicial, was fifth at 2.5 percent. According to CoreLogic, the largest banks are currently pushing legislation that would expedite the foreclosure process in Washington, D.C. Besides District of Columbia, only two non-judicial states out of 25 had foreclosure rates higher than the national average of 1.4 percent in January: Nevada at 2.2 percent and Rhode Island at 1.6 percent. "In judicial foreclosure states, lenders must provide evidence to the courts of delinquency in order to move a borrower into foreclosure," analyst Shu Chen wrote on CoreLogic's blog. "In non-judicial foreclosure states, lenders can issue notices of default directly to the borrower without court intervention. is is an important distinction, since judicial foreclosure states have longer foreclosure timelines, thus affecting foreclosure statistics." Florida led all states in the number of completed foreclosures for the 12-month period ending at the end of January, with 111,000. Florida's total accounted for nearly one-fifth of the nation's total completed foreclosures during that period (552,000). Still, Florida is making great strides in clearing its backlog of foreclosure inventory. e Sunshine State experienced a year-over-year decline in foreclosure inventory of 49 percent in January, the second-highest rate of decrease behind only Maine (49.5 percent). Every state except Wyoming and Massachusetts posted a double-digit, year-over- year percentage decline in foreclosure rate in January. Wyoming's decline was 0.2 percent, and Massachusetts had a 4.4 percent decline. In the District of Columbia, foreclosure inventory increased 22.1 percent year-over-year in January, according to CoreLogic. Twenty-four states posted declines of 30 percent or more. "e foreclosure inventory continues to shrink with declines in all 50 states over the past 12 months," said Anand Nallathambi, president and CEO of CoreLogic. "Florida, one of the hardest hit states during the foreclosure crisis, experienced a decline of almost 50 percent year over year, which is outstanding news." In addition to having the highest foreclosure rate, New Jersey also had the highest serious delinquency rate (rate of loans that are 90 days or more overdue or in foreclosure) at 8.9 percent in January, more than double the national average of 4.0 percent for the month. Florida was second at 7.7 percent, and New York was third with 7.2 percent. All three are judicial foreclosure states. e nationwide judicial foreclosure rate peaked at 5.3 percent in February 2012, while the non-judicial foreclosure rate peaked in January 2011 at 2.8 percent, according to CoreLogic.

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