Even though it takes an average of 19 months to complete a foreclosure today, at least half of the bank-owned REOs in a recent RealtyTrac survey were still occupied by the former homeowner or a tenant.  Many of the owners who stayed in their homes did so rent-free for as much as two years or more since they made their last mortgage payment.

Of the 259,783 bank-owned properties with owner-occupancy data available — out of a total of 483,224 bank-owned homes nationwide — 51 percent were still occupied by the former homeowner or a tenant. Metros with the highest percentage of occupied REOs included Nashville, Tenn. (80 percent), Richmond, Va. (80 percent), New York (73 percent), Houston (73 percent) and San Jose, Calif., (73 percent).

Despite the dwindling number of foreclosures, the time period it takes to complete a foreclosure is increasing. U.S. properties foreclosed in the first quarter of 2014 were in the foreclosure process an average of 572 days, up 1 percent from 564 days in previous quarter and up 20 percent from 477 days in first quarter of 2013.

New Jersey overtook New York as the state with the longest average time to foreclose in the first quarter with an average of 1,103 days to complete foreclosure. That was followed by New York (986 days), Florida (935 days), Hawaii (840 days), and Illinois (830 days).  The average time to foreclose was the shortest among all states in Alaska (151 days), followed by Texas (169 days), Delaware (177 days), New Hampshire (190 days), and Alabama (193 days).

RealtyTrac’s Foreclosure Market Report™ for March and the first quarter of 2014, which shows foreclosure filings — default notices, scheduled auctions and bank repossessions — were reported on 117,485 U.S. properties in March, a 4 percent increase from February but still down 23 percent from a March 2013.

The monthly increase in foreclosure activity was driven by a 7 percent month-over-month increase in foreclosure starts — the initial public notice starting the foreclosure process — and a 6 percent monthly increase in scheduled foreclosure auctions. Lenders repossessed 28,840 U.S. properties in March, down 5 percent from the previous month and down 34 percent from a year ago to the lowest level since July 2007 — an 80-month low.

March was the 42nd consecutive month where U.S. foreclosure activity decreased from a year ago, helping to drop first quarter foreclosure activity to the lowest level since the second quarter of 2007. A total of 341,670 U.S. properties had a foreclosure notice in the first quarter, down 3 percent from the previous quarter and down 23 percent from a year ago. One in every 385 U.S. housing units had a foreclosure filing in the first quarter.

Despite the decrease in overall foreclosure activity in the first quarter, 29 states posted annual increases in scheduled foreclosure auctions, including Utah (up 226 percent), Oregon (up 177 percent), Connecticut (up 131 percent), New Jersey (up 79 percent), Delaware (up 49 percent), New York (up 47 percent), Maryland (up 46 percent), Massachusetts (up 37 percent), Nevada (up 21 percent) and Florida (up 21 percent).

Meanwhile foreclosure starts in the first quarter increased from a year ago in 19 states, including New Jersey (up 83 percent), Maryland (up 43 percent), Indiana (up 38 percent), Delaware (up 24 percent), Connecticut (up 13 percent), and California (up 10 percent). The increase in California was the first annual increase since the second quarter of 2012, and the first double-digit percentage increase since the fourth quarter of 2009.