David Streitfeld reports for The New York Times,
In New York State, it would take lenders 62 years at their current pace, the longest time frame in the nation, to repossess the 213,000 houses now in severe default or foreclosure, according to calculations by LPS Applied Analytics, a prominent real estate data firm.
Across the Hudson it would take 49 years to clear New Jersey’s foreclosure backlog. In nonjudicial foreclosure states like Nevada and California the backlog is not as great–3 years in California, 2 in Nevada. Everyone has heard stories about people who have not made a mortgage payment in months and haven’t heard a peep from their lender.
“If you were in foreclosure four years ago, you were biting your nails, asking yourself, ‘When is the sheriff going to show up and put me on the street?’ ” Herb Blecher, an LPS senior vice president told the NYT. “Now you’re probably not losing any sleep.”
The robo-signing scandal has put a crimp in the major banks’ ability to take title around the country and now new foreclosure cases and repossessions are down by nearly a third nationally since last fall, while in New York, foreclosure filings are down 85 percent since September.
The sheer number of defaults has overwhelmed the banking system and, Streitfeld writes,
Judges these days are also more inclined to scrutinize requests for eviction rather than automatically approve them. The so-called foreclosure mills — law firms that handled many of the suits for the banks — are in retreat under law enforcement pressure. And some analysts suggest that banks are reluctant to take too many houses onto their books at any one moment for fear of flooding a shaky market.
In Dade County Florida the average time to foreclose is up to 738 and counting, with the average in most of the country ranging from 220 to 585 days, even including nonjudicial states.
With millions not paying on their mortgages while still having a roof over their head, one can only guess to what extent this is propping up retail sales and the like.
Until the malinvestment in housing is cleared there can be no real recovery. When will that be? Somewhere between 2 and 62 years.