SALT LAKE CITY — The rate of homes falling into the foreclosure process is declining in Utah. But the Beehive State still ranked among the 10 states with the highest foreclosure rates in the nation, according to a report.

RealtyTrac on Wednesday released its Mid-year 2012 Foreclosure Market Report, which showed more than 1 million U.S. properties with foreclosure filings — default notices, auction sale notices and bank repossessions — in the first half of 2012. The report showed a 2 percent hike from the previous six-month period, but the numbers were still down 11 percent from the first half of 2011.

The report also showed that 1 in 126 U.S. housing units had at least one foreclosure filing in the first six months of the year.

Utah recorded the 10th-highest foreclosure rate with 1 in 108 housing units — 0.93 percent — registering a filing. The state's rate fell 42 percent from the same period last year and was down more than 19 percent from the last half of 2011.

During the second half of last year, Utah ranked ninth for the six-month reporting period.

The report said that first-half foreclosure activity increased year-over-year in 20 states, including Indiana, up 32 percent; Pennsylvania, up 24 percent; South Carolina, Connecticut and Florida, each up 23 percent; and Illinois, up 22 percent.

RealtyTrac reports that overall foreclosure activity was down in the second quarter, driven primarily by a drop in bank repossessions. But the number of properties starting the foreclosure process during the quarter rose 9 percent from the previous quarter and was up 6 percent over the second quarter of 2011.

On a monthly basis, foreclosure activity in June decreased on a year-over-year basis for the 21st consecutive month.

“Lenders and servicers are slowly but surely catching up with the backlog of delinquent loans that under normal circumstances would have started the foreclosure process last year,” Brandon Moore, RealtyTrac chief executive office, said. “The increases in foreclosure starts in the first half of the year will likely translate into more short sales and bank repossessions in the second half of the year and into next year.”

Despite a 61 percent year-over-year drop in foreclosure activity, Nevada posted the nation’s highest foreclosure rate in the first half of 2012 with 1.76 percent of all housing units with a foreclosure filing — 1 in 57. A total of 20,618 Nevada properties had at least one foreclosure filing during the first half of 2012, down 43 percent from the previous six months.

Nevada foreclosure starts increased 61 percent from the first quarter to the second quarter, indicating that lenders there are beginning to adjust to a new law that took effect in October 2011 requiring additional documentation to initiate the foreclosure process, the report stated.

Arizona ranked second in foreclosure activity in the first half of 2012 despite a 37 percent decrease from the same time period in 2011, with 1 in 58 units in a foreclosure filing.

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Third-ranked Georgia saw foreclosure starts during the second quarter increase 5 percent from the previous quarter and rise 23 percent from a year ago.

California registered the nation’s fourth-highest state foreclosure rate for the six month period, with 1.56 percent of housing units with a foreclosure filing, followed by Florida at 1.55 percent.

Rounding out the states with the 10 highest nationwide foreclosure rates were Illinois with 1.40 percent of housing units with foreclosure filing, Michigan at 1.02 percent, Colorado at 0.97 percent, Ohio at 0.94 percent and Utah at 0.93 percent.

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