In addition, an improving housing market, rising home prices and stronger hiring likely has helped some homeowners avoid foreclosure.
Even so, bank repossessions remain elevated and on pace to exceed 650,000 this year, according to RealtyTrac. That would be down from 800,000 last year.
"We're seeing more signs of the light at the end of the tunnel, with foreclosure starts being down," Blomquist said. "But the market still has to deal with the properties that already started foreclosure, and that could keep the (bank repossession) numbers stubbornly high the next year."
Also, lenders are still adjusting to new foreclosure ground rules set forth in a $25 billion settlement reached in February between five major banks and federal and state government officials over claims that many lenders had processed foreclosures without verifying documents.
As banks get a handle on those rules, they may move more quickly against late-paying mortgage-holders, Blomquist said.
All told, banks filed foreclosure-related notices on 180,817 properties last month, down 3 percent from October and down 19 percent from a year earlier.
Foreclosure activity, which RealtyTrac measures as the number of homes receiving a notice of default, scheduled auction or bank repossession, increased on an annual basis in 23 states and Washington D.C.
At the state level, Florida had the highest foreclosure rate of any other state, with one in every 304 households in some stage of foreclosure, or twice the national average.
Rounding out the top 10 states by foreclosure rate were Nevada, Illinois, California, South Carolina, Ohio, Arizona, Georgia, Michigan and Indiana.