The number of residential properties in Connecticut with foreclosure filings inched up modestly in September compared with a year earlier, but the increase wasn’t nearly as severe as the major monthly year-over-year spikes earlier in the summer, a new report being released today says.
Connecticut properties with foreclosure filings totaled 1,299 in September, up from 1,278 a year earlier, a 1.6 percent increase, according to the report from RealtyTrac, which tracks and markets foreclosed properties nationally and state by state.
The increase in Connecticut in September stands in sharp contrast to July, when properties with filings soared to 1,544, more than double the 647 in July 2011.
Daren Blomquist, a RealtyTrac spokesman, told me the jump in July followed the landmark settlement over shoddy mortgage servicing practices that set the ground rules for how foreclosures were to be handled.
Connecticut and other states that process foreclosures through the courts have seen increases since the settlement was signed in April. The settlement was with five major servicers: Bank of America, CitiMortgage Inc., Ally Financial, Inc., J.P. Morgan Chase and Wells Fargo.
Federal and state investigations into mortgage servicing and foreclosure practices slowed processing in courts as filings and other paperwork were reviewed for accuracy. The accuracy was called into question by the “robo-signing” scandal that exposed the practice of signing documents without verifying the information.
“It’s definitely having an impact on the numbers,” Blomquist told me. “There’s a sense that banks were holding back on foreclosures on some properties. Now, the backlog is getting worked out.”
The increase in July and, to a lesser extent, June were certainly eye-catching, but foreclosure activity in 2011 was “artificially low” amid the investigations into the mortgage servicing practices, Blomquist said.
Blomquist said he doesn’t expect many months like July, but he said he expects the state will continue to see increases in foreclosure activity.
In September, the largest portion of properties with filings, 880, were first-time foreclosure notices, followed by 336 bank repossessions and 83 foreclosure auctions, RealtyTrac reported.
Nationally, the number of properties with filings fell 16 percent from September 2011. September’s total was the lowest since July 2007.