The end of the foreclosure crisis is finally in sight for some neighborhoods on the mainland; however, it could take longer for the problem to run its course in Hawaii.

For the first time in almost three years, the number of homeowners falling behind on their loans nationwide is declining. The drop means the number of people losing their homes will start to fall. But some pain from the crisis is sure to persist. Because millions of people are already in foreclosure, deeply discounted houses will put pressure on home prices for years.

“;Housing is on a path to recovery,”; said Mike Larson, a real estate analyst with Weiss Research. “;It's going to be a very long, gradual process.”;

In high-foreclosure cities like Las Vegas, Phoenix and Miami, homes have lost roughly half their values from their peaks. But a report yesterday from the Mortgage Bankers Association showed Nevada, Arizona and Florida had some of the biggest declines in new delinquencies.

The figures probably mark “;the beginning of the end”; of the crisis, said Jay Brinkmann, the trade group's chief economist. However, more than 15 percent of homeowners with a mortgage have missed at least one payment or are in foreclosure, a record. Worse, nearly half of all delinquent borrowers were at least three months behind on their payments, up from a typical level of less than 20 percent.

“;The bad news is that we still have a big problem,”; Brinkmann said. “;The good news is it looks like it may not get much bigger.”;

Still, the problem is not expected to disappear this year for Hawaii, which saw foreclosures ramp up much later than most other states, said Daren Blomquist, marketing communications manager for RealtyTrac, which tracks nationwide foreclosures.

“;The numbers were already so high in Hawaii in 2009 that we would anticipate that the increases would start to come down, but you'll still have increases,”; Blomquist said.

Last month, Hawaii experienced the largest rise in the REO, or bank-owned, category of foreclosures, he said.

“;REOs were up 58 percent from December and 1,013 percent from January 2009,”; Blomquist said. “;This means that more Hawaii homeowners who went into default failed to get out of it. The most painful foreclosure category went up quite a bit in Hawaii.”;

Foreclosure auction notices, a step where the homeowner can still save their home, decreased 31 percent from December but rose 241 percent from January 2009, he said.

But the most telling sign that Hawaii's foreclosure problem will continue at least for several more months is the rise in default notices, Blomquist said. Foreclosure default notices rose 27 percent from December and 79 percent from the prior year, he said.

Nationally, the Mortgage Bankers Association reported some positive trends. The percentage of nationwide borrowers who missed just one payment on their home loans fell to 3.6 percent in the October-to-December quarter from 3.8 percent in the third quarter, according to the Mortgage Bankers Association. Also, the number of borrowers who had missed at least one payment but were not yet in foreclosure also fell for the first time since the beginning of 2007.

Banks are delaying the foreclosure process, traditionally between four and six months, as they evaluate borrowers for help under the Obama administration's $75 billion mortgage-relief effort. It lowers borrowers' payments to as low as 2 percent for five years and extends loan terms to as long as 40 years.

But experts warn that hundreds of thousands of borrowers will not be eligible or will not complete the process. So far, only 116,300 borrowers out of 1 million who enrolled have had the terms of their mortgages changed permanently.

Despite the government's efforts, there could be 6 million foreclosed homes that are put on the market over the next three years, according to Barclays Capital.

Given national trends, it makes sense that Hawaii's foreclosure problem will linger in 2010, Blomquist said.

The nation's foreclosure problem started in states like Nevada, Florida and California, where there was the most speculative and second-home investment, he said. But over time the problem has broadened out to communities where people stretched themselves financially to buy a home during the last frenzy when “;everyone was convinced that prices would never stop going up,”; Blomquist said.

While Hawaii's foreclosure problem was concentrated for much of 2009 in neighbor island communities like Kailua-Kona, Waikoloa and Pahoa on the Big Island; Kihei on Maui; and Kapaa and Lihue on Kauai, Oahu's predominantly local neighborhoods like Ewa Beach, Waianae, Mililani and Waipahu were listed among the state's top 10 foreclosure hot spots last month, he said.

“;Foreclosures typically start in second-home and investor markets, but as economic problems deepened they have rippled out to local neighborhoods,”; Blomquist said.

Allison Schaefers contributed to this report.