Foreclosures Hit New High as Banks Clean House

A record number of US homes were lost to foreclosure in the first three months of this year, a sign that banks are starting to wade through the backlog of troubled home loans at a faster pace, according to a new report. RealtyTrac said today that the number of homes taken over by banks jumped 35% in the first quarter from a year ago. More than 900,000 homes were taken, which is the most going back to at least January 2005, when RealtyTrac began reporting the data.

"We're right now on pace to see more than 1 million bank repossessions this year," said a RealtyTrac exec. Foreclosures began to ease last year as banks came under pressure from the Obama administration to modify home loans for troubled borrowers, and some states enacted foreclosure moratoriums. "We're finally seeing the banks start to process the inventory that has been in foreclosure, but delayed in processing," said the RealtyTrac exec. "We expect the pace to accelerate as the year goes on." (More real estate stories.)