Massachusetts Home Buyer Guide

The number of completed foreclosures in the United States declined 19 percent in January compared to January 2013, CoreLogic, a residential property data provider, reported February 27, 2014.

There were 48,000 completed foreclosures across the United States, down from 59,000 in January 2013. As a basis of comparison, before the decline in the housing market in 2007, completed foreclosures averaged 21,000 per month nationwide between 2000 and 2006.

Completed foreclosures are an indication of the total number of homes actually lost to foreclosure. Since the financial crisis began in September 2008, there have been approximately 4.9 million completed foreclosures across the country.

A completed foreclosure occurs when a property is auctioned and results in the purchase of the home at auction by either a third party, such as an investor, or by the lender. If the home is purchased by the lender, it is moved into the lender's real estate owned (REO) inventory. In "foreclosure by advertisement" states or non-judicial states, a redemption period begins after the auction and runs for a statutory period, e.g., six months. During that period, the borrower may regain the foreclosed home by paying all amounts due as calculated under the statute. For purposes of the CoreLogic's foreclosure report, because so few homes are actually redeemed following an auction, it is assumed that the foreclosure process ends in "foreclosure by advertisement" states at the completion of the auction.

As of January 2014, approximately 794,000 homes in the United States were in some stage of foreclosure, known as the foreclosure inventory, compared to 1.2 million in January 2013, a year-over-year decrease of 33 percent. The foreclosure inventory as of January represented 2.0 percent of all homes with a mortgage, compared to 2.9 percent in January 2013.

The five states with the highest number of completed foreclosures for the 12 months ending in January 2014 were Florida (116,000), Michigan (52,000), Texas (39,000), California (38,000) and Georgia (35,000). These five states accounted for almost half of all completed foreclosures nationwide.

Massachusetts had just 2,681 completed foreclosures in that same 12-month period.

The five states (including the District of Columbia) with the lowest number of completed foreclosures for the 12 months ending in January 2014 were District of Columbia (60), North Dakota (427), Hawaii (526), West Virginia (543) and Wyoming (732).

The five states with the highest foreclosure inventory as a percentage of all mortgaged homes were Florida (6.4 percent), New Jersey (6.3 percent), New York (4.8 percent), Connecticut (3.4 percent) and Maine (3.4 percent).

For Massachusetts, foreclosure inventory as a percentage of all mortgaged homes stood at 1.3 percent.

The five states with the lowest foreclosure inventory as a percentage of all mortgaged homes were Wyoming (0.4 percent), Alaska (0.5 percent), North Dakota (0.6 percent), Colorado (0.5 percent) and Nebraska (0.6 percent).