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Banks getting around to "more difficult" foreclosures

Aug 21, 2015

Bank repossessions of homes in Michigan is on the rise - while new home foreclosure filings are down
Credit Jeff Turner / Michigan Radio

Bank repossessions of Michigan homes in foreclosure were 137% higher in July than the same month a year ago.

Daren Blomquist of RealtyTrac says several factors are at play. 

For one, the economy is better - and that means more people are entering the home buying market.

"It's a much better time from the bank's perspective to foreclose on these homes," says Blomquist, "and then put them on the market, because they can sell them for a much higher price point than even just a few years ago."

And while public outcry a few years ago criticized banks for foreclosing on people too fast,  the opposite is now happening.

With so many homes in poor condition dotting neighborhoods, "the banks are getting criticized for almost taking too long to foreclose now."

Blomquist says banks are turning their attention to a backlog of "more difficult" home foreclosures, most of which are still linked to the housing bubble of 2006-2008. 

The good news is that far fewer homes are falling into foreclosure for the first time. New foreclosure filings in the state dropped 37% from last July.