Foreclosures in northeast Indiana are retreating, a regional real estate association said.
The number of people losing their homes decreased 26 percent during the second quarter, compared with the same period a year ago, figures from the Upstate Alliance of Realtors show. There were 169 foreclosures in the second quarter compared to 229 in the same period last year, based on data released last week.
Upstate Alliance tracks Allen, Adams, DeKalb, Huntington, Noble, Wells and Whitley counties.
Adam Smith, a broker with Coldwell Banker and president of the Upstate Alliance, said fewer foreclosures will result in a stronger housing market and proves banks are responding to the robo-signing scandal that occurred during the recession.
The practice sparked federal investigations of lenders. Some institutions were guilty of approving foreclosures without verifying documents or using fake signatures to speed the process.
The nation’s five largest mortgage lenders last year agreed to overhaul their mortgage servicing practices and pay $25 billion to U.S. states to help those who lost their homes or faced foreclosure.
They’re being real careful and not flooding the market with foreclosed homes, Smith said.
At the current monthly pace, completed foreclosures will total about 550,000 this year, down from 671,000 last year, RealtyTrac said.
Indiana ranks seventh among the top 10 foreclosure states, according to RealtyTrac.
Still, Smith said the housing market has a long way to go before it returns to pre-recession levels.
Paula McGee, a partner with the Indiana Foreclosure Prevention Network, agrees. In fact, she questions if foreclosure statistics are as improved as they seem.
I don’t believe the numbers are going down because foreclosures are still happening, said McGee, director of housing and economic development for the Fort Wayne Urban League. People are still contacting us for help.
In 2010, Allen County served as the launch area for settlement conferences, which allow homeowners on the verge of losing their properties to make arrangements with lenders. This process is lengthy, McGee said, and many foreclosures aren’t being counted during this time.
From our experience, many people are still at risk of losing their homes, McGee said.
Founded in 2011, the Indiana Foreclosure Prevention Network is a coalition of community service and housing-related organizations, government agencies, lenders, Realtors, and trade associations that address Hoosier foreclosures.
The federal government has awarded Indiana more than $221 million to help unemployed homeowners pay their mortgages.
Federal assistance began in 2011.
As of June 30, more than 1,800 homeowners have been helped through Indiana’s Hardest Hit Fund.
Michael Hicks, an economics professor at Ball State University, said progress will continue to be slow.
We haven’t finished feeling the effects of the downturn, he said. However, I find it highly believable that foreclosures are decreasing. Economic conditions aren’t worse than they were two years ago, but they’re not remarkably better either.
Smith maintains there are still reasons for optimism. For instance, 724 homes sold in June, up 9.2 percent from the 663 sold in June 2012. And the first half of the year has seen 3,475 homes sell, a 12.1 percent increase from the 3,100 in the same period a year earlier.