June 7th, 2012
Lender Processing Services reports foreclosure starts declined in April, but the same statistic for loans backed by the Federal Housing Administration increased markedly which could impact affordability for those trying to relocate.
Total foreclosure starts dropped 2.6 percent in April, but those homes under the FHA umbrella witnessed foreclosure starts spike 73 percent, the report explained. However, many of these actions were due to loans from 2008 and 2009, which was the depth of the recession.
"In 2008, when the loan origination market virtually dried up, the FHA stepped in to fill the void," said Herb Blecher, senior vice president for LPS Applied Analytics. "FHA originations tripled that year, and increased to five times historical averages in 2009."
The report added that total volume for foreclosure sales is approximately one-third of all foreclosure starts. Total sales dropped 2.6 percent in April when compared to March.
While still-elevated levels of foreclosures in parts of the U.S. may reveal that recovery still has a long way to go, foreclosures may increase affordability for companies and employees looking to complete the corporate relocation process. This is because these homes are typically sold at a significant discount.