State foreclosures rise steeply in 2010

The annual increase would have been even more dramatic without a steep drop in foreclosures during the last few months of 2010. The slowdown in activity was prompted by heightened concerns nationwide about lenders’ alleged sloppy practices and fraudulent property takings.

In December, 481 foreclosure deeds were filed in Massachusetts, about 44 percent fewer than during the same month the previous year, according to Warren Group, a Boston company that tracks local real estate.

Also, fewer foreclosure proceedings were initiated last month, with the number falling to 733, nearly 65 percent below December 2009’s figure. Because of the tempered activity at year’s end, the total number of foreclosure petitions filed in 2010 dropped to 23,933, a 14.3 percent decrease compared with the year before.

“These statistics for petitions to foreclose are skewed by lenders who slowed their foreclosure processing in the last four months of the year,’’ said Timothy M. Warren Jr., chief executive of Warren Group. “It is important to remain cautious heading into 2011.’’

Last fall, several major US lenders — including Bank of America Corp. and JPMorgan Chase & Co. — temporarily imposed moratoriums on foreclosures after acknowledging that some employees signed thousands of legal documents with out reviewing the paperwork. Soon after, attorneys general in all 50 states said they would investigate lenders’ foreclosure practices. That investigation is ongoing.

In the latest troubling news for mortgage lenders, the Massachusetts Supreme Judicial Court earlier this month upheld a lower court’s decision to void two Springfield foreclosures because the lenders could not prove they owned the mortgages. The decision has clouded the ownership on hundreds, if not thousands, of foreclosed properties and prompted several new legislative and regulatory proposals to resolve issues related to how foreclosures are carried out.

Adding to debate in Massachusetts, Barbara Anthony, undersecretary of the state Office of Consumer Affairs and Business Regulation, yesterday detailed two new proposals that would force lenders to prove they own home mortgages before starting a foreclosure.

Anthony said the state should draft regulations mandating that lenders provide proof they own a mortgage when they notify homeowners who are delinquent on payments that their homes are at risk of foreclosure. She also proposed legislation that would require lenders to show they own a house at the same time they notify Land Court they have sent a “right-to-cure’’ notice. Such notices give delinquent borrowers 150 days to make late payments or otherwise find a way to avoid foreclosure.

“The ownership of a mortgage should be a basic fact that is clear to a homeowner not just during foreclosure, but at any point in a loan relationship,’’ Anthony said in a statement. “These proposed reforms will ensure that homeowners are not dealing with a lender with no right to pursue foreclosure, and will give potential buyers confidence they are purchasing property with a clear title.’’

Jenifer B. McKim can be reached at jmckim@globe.com.