While RealtyTrac's most recent report—which found that May foreclosure filings at the national level surged nearly 50 percent from a year earlier—was just more bad news for the already-despondent housing market, BusinessWeek's HotProperty blog points out that it included some striking findings about one particular state: Maryland.
Maryland, which had the sixth worst foreclosure rate in April, had fallen back to No. 22 on the list in May. The May rate of foreclosure filings dropped by 61% in Maryland from a month earlier. Why such a big drop off? One possibility: a new law in Maryland that took effect in April gives distressed homeowners a little breathing room. Lenders must wait at least 90 days after a borrower defaults on a loan before initiating foreclosure proceedings. Lenders must also warn homeowners at least 45 days in advance that they are initiating foreclosure actions.
Maryland officials, however, need to keep their fingers crossed that their efforts will enable struggling borrowers to work with their lenders to avoid foreclosure altogether—rather than simply delay the filings for a couple of months.