Joe Cox, an organizer for Maryland ACORN, a community organization that helps homeowners try to avoid foreclosure, said the new law contributed to the decline in the quarter, but it is likely a "blip."
Cox said ACORN's Baltimore office is seeing up to 20 homeowners a week seeking foreclosure-prevention counseling. The group's Prince George's County office is trying to help even more homeowners.
"Until there is something to force the banks to modify loans for borrowers ... it's going to get worse," he said.
The biggest share of foreclosures in the state were in Prince George's County, with 35 percent, followed by Montgomery County, with more than 14 percent, and Baltimore, with 11 percent, according to data released by RealtyTrac, an online source of foreclosure statistics. RealtyTrac was criticized as sharply underestimating foreclosure numbers in 2006, which some believe led to an inflated increase reported in 2007.
Yesterday, Massoud Ahmadi, director of planning and research for the state housing department, defended the figures, which he said are comparable to statistics from the Mortgage Bankers Association. He said the numbers are "scrubbed" to ensure that no property is counted as a foreclosure more than once.
Maryland ranks 20th in the nation in terms of the number of foreclosures in the third quarter, an improvement from the beginning of the year when it ranked 12th. In a five-state region that also includes Washington, D.C., Maryland had the third-highest number of foreclosures, behind Virginia and Pennsylvania for the third quarter.
"The foreclosure situation is still pretty dark," said Celia Chen, senior director of housing economics for Moody's Economy.com. "I would expect that foreclosures would rise again in the fourth quarter of this year, and probably even to the beginning of next year. ... Given the weak global economy now, the prospect for a reversal of the trend anytime over the next quarter or two is pretty dim."
Many borrowers took on mortgages at the height of the housing boom, believing they could eventually refinance to a lower loan rate or sell their homes if values increased.
But home prices in Maryland fell 6 percent in the third quarter compared with the corresponding period a year earlier, according to the Office of Federal Housing Enterprise Oversight.
State officials said yesterday that they began trying to address the foreclosure crisis more than a year ago through the MDHope.org Web site, a consumer hot line and various financing products.
