One of the most common drivers of Las Vegas bankruptcy is home foreclosure, and given that so many people in Nevada are underwater in their mortgages, it’s no wonder that the public is curious about if and how national foreclosure trends are affecting their communities. According to the Associated Press, the foreclosure listing firm RealtyTrac issued a report on changes in the number of foreclosures in the United States. There is both good and bad news for Las Vegas residents.
September 2012 saw 180,400 foreclosures, the lowest in five years, and foreclosures declined in August 2012 as well.
The number of foreclosures initiated, referred to as “foreclosure starts,” dropped 12 percent to 87,000. Foreclosure starts had been rising in the previous three months.
By contrast, before the housing bust, foreclosure there were only 34,000 foreclosure starts in May 2005, so there are currently twice as many foreclosures being initiated as usual.
The distribution of foreclosure starts differs widely throughout the U.S. In “non-judicial” states, where foreclosure doesn’t require court approval, the number of foreclosure starts is dropping, particularly in California, Arizona, Michigan, Georgia, and Texas.
In “judicial” states—New Jersey, Pennsylvania, New York, and Florida—foreclosures are rising because courts are clearing the backlog of foreclosure cases. Accusations of “robo-signing,” fraudulently produced mortgage documents used to further the foreclosure process, helped this backlog form, but no longer.
The AP listed Florida, Arizona, California, Illinois, and Georgia as the states with the highest foreclosure rates in September 2012. Unfortunately, this appears to be in error: A subsequent piece indicated that Nevada, sadly, had the fifth highest foreclosure rate.
Worse, the foreclosure rate in Nevada slowed not because banks were initiating fewer proceedings but because state law changed in October 2011 to require more documentation from banks.
As a result of the law change, foreclosures are less common in Las Vegas than a year ago, but that doesn’t mean that homeowners are in the clear. Many mortgages are still underwater and must be dealt with. If you are in these circumstances, it’s important to discuss all your options with an experienced Las Vegas bankruptcy lawyer. Filing a Chapter 7 or Chapter 13 bankruptcy might help you resolve your underwater home or mortgage default.
For more questions about bankruptcy in Las Vegas, please feel free to contact an experienced Freedom Law Firm Las Vegas bankruptcy attorney for a free initial consultation. Call us at 1-702-803-9251 to set up your free consultation.