Foreclosures dropped across the country in Q209, according to the U.S. Foreclosure Index from property information specialists ForeclosureS.com. Foreclosures dropped 11% during Q209 to 205,01. The crowded Northeast region led the way with a 32% fewer families losing their homes than in the previous quarter. Pre-foreclosures – notices of default early in the foreclosure process – fell by 10% from Q109 to 494,078. In the Midwest, 42% fewer notices were given. June’s 61,573 foreclosures marked a record low for the year. Foreclosures in June shrunk by 13% from May and 14% from 2009’s high in February. June’s pre-foreclosures fell by 24% from May and 35% from March’s peak. “These huge drops — double-digit in many parts of the nation — are a sigh of relief for the economy and housing markets as they bump along toward recovery,” said Alexis McGee, president of ForeclosureS.com, in a corporate release. “Despite higher unemployment rates, industry and government stimuli are making a difference.” Also, as a sign of a recovering market, the total of nationwide foreclosures from January to June 2009 was 3% lower when compared to the same time frame in 2008. The decline isn’t dramatic, but 2009 has not seen the increase in new filings that most expected, McGee said in the release. But the clouds haven’t cleared yet. For example, in the Midwest, Illinois’ numbers reflect its up-to-90-day moratorium, which began in April. June foreclosures are down 45% for the state from the first quarter, but pre-foreclosures spiked 88% from May. When the moratoriums expire, McGee predicts that the foreclosure and pre-foreclosure rates will uptick. But other markets could cushion the blow. Foreclosed homes in California declined by 26% from last year. “As the numbers reflect, the recovery is a mixed, up and down process, but there are plenty of positive signals,” McGee said. Write to Jon Prior.

More: