Foreclosures continued to rise in September, though at a decelerating pace, and are on track to surpass 1 million by yearend, according to a report Thursday by ForeclosureS.com, a Sacramento company that tracks foreclosure notices nationwide.

Foreclosures rose 82.6% last month compared with a year earlier and were up 6.6% from August.

One bright spot: Preforeclosure filings fell 2.4% in September from a year earlier, with double-digit declines in the hardest-hit states of California and Michigan, though it was unclear whether the drop in preforeclosure filings could be attributed to changes in state laws or to more loan modifications by lenders and servicers to keep defaulted borrowers in their homes.

However, the company warned that the slumping U.S. housing market still faces significant problems. "The gains likely are temporary and not necessarily indicative of the foreclosure crisis' easing just yet," Alexis McGee, ForeclosureS.com's president, said in a press release.

California enacted a law in July to establish detailed procedures requiring lenders to assess the financial condition of defaulted borrowers and explore options for avoiding foreclosure.

Foreclosure filings rose 81.4% in the third quarter from a year earlier, to 561,467 total filings, according to ForeclosureS.com, and 22.4 of every 1,000 households is in foreclosure.

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