Nationwide, nearly 766,000 homes received at least one foreclosure-related notice during the third quarter which is 71 percent increase from the same period last year, reported RealtyTrac Inc, an online marketer of foreclosed properties.

In September, 265,598 troubled borrowers received foreclosure filings nationwide in the September. The filings declined 12% from the record high number in August, but 21% more than in September 2007.

Of the troubled borrowers, 81,312 homes were lost to foreclosure, according to a report released Thursday. RealtyTrac monitors default notices, auction sale notices and bank repossessions.

All told 765,558 foreclosure filings were made on U.S. properties in the third quarter of this year - up 3% from the second quarter and 71% from the same period last year.

The reason for the decline in foreclosure filings was attributed largely to the decisions by several states to relax housing laws.

"Much of the 12% decrease in September can be attributed to changes in state laws that have at least temporarily slowed down the pace at which lenders are moving forward with foreclosures," Realty Trac CEO James Saccacio said in a statement.

Six states, particularly, California, Florida, Arizona, Ohio, Michigan and Nevada  accounted for more than 60 percent of all foreclosure activity in the quarter, with California alone representing more than a quarter of all U.S. foreclosure filings.

Detroit and Atlanta were the only cities outside California, Florida, Nevada and Arizona to make RealtyTrac’s list of the 20 hardest-hit metropolitan areas.

The combination of declining home values, stricter mortgage lending standards and a downward economy has left hundreds of thousands of homeowners with few options. Many can’t find buyers or the value of their home is less of what they owe and can’t refinance into an affordable loan, with the global credit crisis making loans far less available.

The government has intervened and that it people are waiting on how their effort will help the industry recover from the crisis. Earlier this month, the Federal Housing Administration launched a program aimed to prevent foreclosures by allowing homeowners to swap their mortgages for more affordable loans, only with an agreement from their lender to take a loss on the initial loan. The bill is projected to help about 400,000 households.