IRVINE, CA—The number of zombie foreclosures—properties that have begun the foreclosure process but have never been foreclosed and the homeowner has vacated the property—has decreased 7% from the first quarter of the year and has decreased 16% from second-quarter 2013, according to RealtyTrac. The foreclosures are one of the lingering legacies of the recent housing crisis, a byproduct of lengthy foreclosure timelines and changing state foreclosure statues, but they are on a downward spiral.
One in every five foreclosures has been vacated by the homeowner before the foreclosure is completed, a total of 141,406 zombie foreclosures nationwide in Q2, totaling 21% of total properties in foreclosure, RealtyTrac reports. There were 24 states bucking the trend with an increasing number of zombie foreclosures from the previous quarter, plus DC, and 10 states plus DC saw an increase from a year ago, including New Jersey, New York and Maryland.
States with the most zombie foreclosures include Florida, which accounted for more than one-third of all zombie foreclosures, New York, New Jersey, Illinois and Ohio. The states with the zombies that had been in foreclosure for the longest average time were New York, Florida, New Jersey, Illinois and Hawaii. Financial institutions listed as the beneficiary on the foreclosure documents with the most zombie foreclosures were Wells Fargo, Bank of America, Chase and US BankCorp.
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