Most of the nation's largest metropolitan areas are seeing a sharp drop in foreclosure activity as banks take longer to move against homeowners who are behind on their mortgage payments.

In the first half of this year, 84 percent of metropolitan areas with a population of at least 200,000 saw their foreclosure rate drop versus the same period last year, foreclosure listing firm RealtyTrac Inc. said Thursday.

The firm tracks notices for defaults, scheduled home auctions and home repossessions — warnings that can lead up to a home eventually being lost to foreclosure.

All told, foreclosure activity declined in 178 of the country's 211 largest metropolitan areas during the first six months of the year.

The decline is due to delays in the foreclosure process as lenders work through foreclosure documentation problems that first surfaced last fall. Those problems prompted them to resubmit paperwork on many properties that had been slated for foreclosure and led to a slew of government investigations of the mortgage industry.

Mortgage banks also have put off taking action against newly delinquent borrowers in order to try loan modifications or other tactics aimed at avoiding foreclosure. Lackluster home sales this year also have provided little incentive for lenders to evict homeowners and chance having the property sit empty and unsold for months.

Some 1.7 million potential foreclosures are being held up, according real estate firm CoreLogic.

The slowdown in foreclosure activity has been most pronounced in states where courts play a role in the foreclosure process and now have to wade through a logjam of cases.

The 20 metropolitan areas that saw the biggest annual declines in foreclosure activity are in New York, Maryland, Florida, New Jersey, Connecticut, Massachusetts and Illinois — all judicial foreclosure states, RealtyTrac said.

Syracuse, N.Y., led the decline, posting a 78 percent drop in its foreclosure rate versus the January-through-June period last year. The city had the third-lowest foreclosure rate among the 211 metropolitan areas in RealtyTrac's report.

Despite the slowdown in the pace of foreclosures, many cities continue to have elevated foreclosure rates.

California, Nevada and Arizona, among the states most affected by the housing bust and ensuing foreclosure crisis, account for the 10 metropolitan areas with the highest foreclosure rate for the first six months of the year.

Las Vegas-Paradise, Nev., registered the highest foreclosure rate in the nation, with one in every 19 households receiving a foreclosure-related notice — nearly six times the national average. But the metropolitan area's foreclosure activity fell 17.9 percent from the first six months of last year.

The Phoenix-Mesa-Scottsdale, Ariz., metropolitan area was second, with one in 28 households receiving a foreclosure warning, even as foreclosure activity fell nearly 17 percent from the same period in 2010.

California is home to seven of the metro areas that were among the top 10 metropolitan areas with the highest foreclosure rate in the first half of the year, led by Modesto with one in every 30 households receiving a foreclosure-related notice.

Bucking the trend, some metropolitan areas saw their foreclosure rates spike in the first six months of this year.

Among those, Seattle posted the sharpest increase, a 10 percent jump versus the same period last year, RealtyTrac said. One in every 98 households got a foreclosure-related notice.

Job loss, rather than time-bomb mortgages resetting to higher payments, has become the main driver behind rising foreclosures.

The Seattle metropolitan area's unemployment rate stood at 9.2 at the beginning of the year, but it has eased of late, sliding to 8.5 percent in May.

Still, the metro area has seen the number of people who applied for unemployment benefits due to large-scale layoffs increase this year. In the first quarter, it was ranked 8th highest on the basis of initial unemployment claimants due to layoffs, up from 15th a year earlier.

"The lag time between job loss and foreclosure is a little longer than it is in a normal cycle," said Rick Sharga, a senior vice president at RealtyTrac. "We could be seeing a fallout from job losses there over the last year or two."