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Foreclosure Inventory Drops 31% in October

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NEW YORK (TheStreet) -- The foreclosure inventory rate continued to drop sharply, though the current levels still remain well above normal.

The number of completed foreclosures in October dropped to 48,000, down 25.6% from the previous month and more thanr 30% from a year earlier, according to the latest report from CoreLogic.

The current pace is still more than double the foreclosure rate of 21,000 a month that prevailed prior to the bubble.

As of October 2013, 879,000 homes were in some stage of foreclosure, down 31% from 1.3 million homes a year earlier. That represents 2.2% of all homes with a mortgage and is down from 3.1% a year earlier. Still, in normal times, the foreclosure inventory rate was just about 0.6%.

But the improvement in the level of distressed loans is nevertheless a sign that the housing market is healing and it bodes well for home prices.

"The scourge of an elevated foreclosure inventory is easing. In October, every state posted a year-over-year decline in completed foreclosures, which is positive news," said Anand Nallathambi, president and CEO of CoreLogic in a statement. "Additionally, the rate of serious delinquencies, which fell more than 25% year over year, is at the lowest level in nearly five years, which is great news as we head into a new year."

-- Written by Shanthi Bharatwaj in New York.