Bank repos at lowest level in 65 months

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As housing markets continued to recover and with spring buying season just around the corner, repossessions of homes in February plunged to a 65-month low, RealtyTrac reports.

The number of homes entering real-estate owned (REO) inventory fell to 45,038 in February, down 11 percent from January, according to RealtyTrac’s February 2013 U.S. Foreclosure Market Report. Year-over-year, the number of homes repossessed plunged 29 percent, to the lowest level since September 2007, RealtyTrac said.

The report also found that overall foreclosure-related filings — which, in addition to repossessions, include notices of default and auction notices — clocked in at 154,281, up 2 percent from January, but down 25 percent from a year earlier.

"At a high level the U.S. foreclosure inferno has been effectively contained and should be reduced to a slow burn in the next two years," said Daren Blomquist, vice president at RealtyTrac.

Even so, Blomquist noted that notices of default — which initiate the foreclosure process — actually rose nationally in February, increasing 10 percent from January after three consecutive months of declines. The increase was sharper in "judicial foreclosure" states, where courts continue to work through backlogs of foreclosures, Blomquist said.

At a national level, foreclosure starts rose from last month in 32 states, but only 16 states saw annual increases, the report said.