About 1.9 million homes entered the foreclosure process in 2011, the lowest level since 2007 when the recession began, according to a report Thursday by the foreclosure listing firm RealtyTrac Inc.
The firm cautioned that the decline does not necessarily indicate that the housing market is getting better, as many foreclosures have been delayed due to confusion over documentation and legal issues involved in the process.
There have also been problems with the way some lenders were handling foreclosures. Specifically, signing off on home foreclosures without first verifying documents - a practice referred to as "robo-signing." Many of the nation's largest banks reacted by temporarily ceasing all foreclosures, re-filing previously filed foreclosure cases and revisiting pending cases to prevent errors.
"Foreclosures were in full delay mode in 2011, resulting in a dramatic drop in foreclosure activity for the year," RealtyTrac CEO Brandon Moore said in a statement.
The listing firm anticipates that 2012's foreclosure rate will be higher than last year's, but will remain below the peak of 2010.