Foreclosures take a Christmas break

ATLANTA — Families in foreclosed homes are getting a holiday reprieve again this year, as government-sponsored mortgage giants Fannie Mae and Freddie Mac, and major banks including Wells Fargo, are holding off on foreclosures and evictions until 2012.

Like last year, the Thanksgiving and Christmas moratorium is dropping foreclosure notices. That comes on top of a number of factors helping to depress the total of foreclosures in 2011 — including federal regulators requiring more careful paperwork and a push by banks and non-profits for refinancings, and the effects of the "robo-signing crisis," in which lenders stopped foreclosures because forged or illegal real estate documents were found in many cases.

In Lexington, there were 356 foreclosures through August, according to data recently released by the county's property valuation administrator. That's down from 423 through the first eight months of 2010.

Still, no U.S. housing market has ever experienced the many pressures and changes like those of today, experts say. That makes it difficult to interpret what the shifting numbers mean.

"We had this ridiculous amount of foreclosures for all of 2009 and 2010, and it carried into the first quarter of 2011," said Barry Bramlett, chief executive of Equity Depot's Foreclosure Report.

"We are definitely going to be down in the number of properties advertised for foreclosure this year. If the only criteria is that less foreclosures are good, then that is a good thing," he said.

But if the dropping number in 2011 means homeowners in shaky situations and ripe for eviction are just being put off to another day, it will slow the process by which the market is clearing itself of bad loans, Bramlett said.

"If your criteria is we are just going to continue stagnant because we won't allow the situation to weed itself out, then it is bad," Bramlett said.

"And all these influences which are influencing us downward are still there. It makes you think it is not going to change quickly."