August is one for the books, as mortgage lenders repossessed more homes in August than in any month since the start of the housing crisis. According to foreclosure listing firm RealtyTrac Inc. , the rise occurred as the number of properties entering the foreclosure process slowed for the seventh consecutive month. Banks repossessed 95,364 properties in August, up 3 percent from July and an increase of 25 percent from August 2009.
More than 2.3 million homes have been repossessed by lenders since the recession began in December 2007. The firm estimates more than 1 million American households are likely to lose their homes to foreclosure this year.
According to RealtyTrac, in total, 338,836 properties received a foreclosure-related warning in August, up 4% from July. Banks repossess to clear a backlog of bad loans, eventually placing the foreclosed properties on the market. The number of properties receiving an initial default notice — the first step in the foreclosure process — slipped 1 percent last month from July, but was down 30 percent versus August last year.