Like the rest of New England, 3.8 percent of Vermont's home mortgages were in foreclosure as of December 31, 2011, according to the Mortgage Bankers Association National Delinquency Survey.
The portion of Vermont mortages in foreclosure rose fairly dramatically compared to prior months. Between September 30, 2011 and December 31, 2011, this rate increased more in Vermont than in any other state.
Since Vermont is a judicial state, lenders must obtain judicial permission prior to foreclosing. The country's judicial states have the largest foreclosure inventories in the nation relative to their housing stocks. This is likely due in part to the effect of judicial foreclosure on the length of time needed to move a home through the foreclosure process, according to a recent study completed by the Boston Federal Reserve Bank.
Relatively few additional mortgages (0.65%) started the foreclosure process in Vermont during the quarter ending December 30, 2011. Vermont's foreclosure start rate was lower than the New England and national averages. Only ten states had lower rates than Vermont.
The percentage of mortgages that had delinquent payments (but were not in foreclosure) in Vermont (5.5%) remained virtually unchanged from a year ago. This rate was the lowest in New England. Only nine states in the U.S. had lower delinquency rates.