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Notably, states that have been foreclosure hotbeds throughout the housing downturn
-- California, Nevada and Arizona -- each recorded sharp annual declines in home repossessions last month. One factor: Banks are increasingly opting to resolve foreclosure cases via short sale, rather than completing the foreclosure process by taking back properties. In the first three months of the year, short sales grew 25 percent from a year earlier, hitting a three-year high. In contrast, sales of bank-owned properties declined 15 percent versus the first quarter of last year, according to RealtyTrac. "The trend we're seeing is actually short sales are becoming the preferred method for many lenders, rather than bank repossession," Blomquist said. Foreclosure sales can spell trouble for nearby homeowners, who could see the value of their homes erode further as neighboring foreclosures sell. But short sales typically sell at a smaller discount than bank-owned homes, so they have less of a negative impact on home prices. All told, foreclosure-related notices were reported on 205,990 U.S. properties last month, an increase of 9 percent from April and down 4 percent versus May last year, RealtyTrac said. On a state level, foreclosure activity in Georgia jumped 33 percent between April and May, and vaulted 30 percent from May last year. That translates to one in every 300 households receiving a foreclosure-related warning, the nation's highest foreclosure rate last month. Rounding out the top 10 states with the highest foreclosure rate in May are Arizona, Nevada, California, Illinois, Florida, Ohio, Michigan, South Carolina and Utah.
[Associated
Press;
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