FHA Mortgage Delinquencies Continue to Rise, Originations Decline

January 31, 2012 (Shirley Allen)

The number of seriously delinquent loans insured by the Federal Housing Administration (FHA) continued to climb in December, increasing 3.2 percent from November and is 18.9 percent higher than a year ago according to the agency’s Single-Family Outlook report for December.

An additional 21,736 loans became 90 days or more past due in December bringing the total number of seriously delinquent loans in the FHA’s portfolio to 711,082. In the last year, the number of seriously delinquent loans has increased by 112,942.

The serious delinquency rate was 9.6 percent in December, up from 9.3 percent in November and also up from 8.8 percent in December 2010.

A total of 110,427 FHA loan applications were submitted in December, 12.1 percent lower than the 125,596 applications submitted in the previous month of November. The total number of applications submitted was slightly lower than in December of last year when 112,500 applications were submitted, a decline of 1.8 percent.

Refinance loan applications declined by 7.2 percent from November to December with a total of 47,101 applications submitted in December compared to 50,730 in November. Refinance applications were 0.6 percent higher than in December of last year when 46,840 applications were submitted.

The total number of purchase loan applications was also lower in December, declining by 15.0 percent compared to November. A total of 57,234 applications were submitted in December to purchase homes, down from 67,358 applications submitted in November. Purchase applications were 0.3 percent lower than in December of last year when 57,390 applications were submitted.

The total number of FHA insured loans that were completed in December increased 6.3 percent from November, rising from 88,206 to 93,739. December’s loan completions continued to remain well behind last year’s pace of 133,603 loan completions.

Loans for purchased homes accounted for 62.5 percent of all completed FHA insured loans in December with 58,589 completed, a gain of 2.7 percent from November but 11.5 percent lower than the 66,165 purchase money mortgages in December of 2010.

Completed FHA insured refinance loans accounted for 32.6 percent of all completed loans in December, which was 49.9 percent lower than last year. The 30,515 loans completed in December were still 15.1 percent higher than in November.

The average FICO score for a homebuyer securing an FHA loan in December was 696, up from 695 in November but down from 701 a year ago. For refinanced transactions, the average FICO score in December was 706, up from 703 the previous month and from 705 a year earlier.

At the end of December, the FHA had 7,414,979 insured single-family mortgages in its portfolio with an amortized balance of $1.036 trillion.

The number of loans insured by the FHA has increased by 8.8 percent in the last year while the amortized balance has increased by 10.9 percent.

Tags: FHA, Single-family Outlook report, loan originations, purchase loans, refinance loans, FICO score, serious delinquency rate

Source:
HUD