Foreclosure Inventory at an All-Time High

May 3, 2011 (Chris Moore)

Foreclosure inventory stood at an all-time high at the end of March according the March Mortgage Monitor released by Lender Processing Services (LPS). At 2.2 million properties, foreclosure inventories are 8 times historic norms. Delinquencies continued to decline to the lowest levels since 2008.

The report also shows that foreclosure starts increased by 33 percent since the end of February to 270,681. That was the largest amount of foreclosure starts since the beginning of the foreclosure moratorium following the “robo-signing” controversy. Foreclosure sales increased significantly, also reaching levels prior to the “robo-signing” controversy, which suggests that the slowdown in foreclosure activity due to the moratorium may be passing.

Delinquencies declined in March to the lowest level since 2008, dropping more than 11 percent compared to February, and down nearly 20 percent since March of 2010.

Early-stage delinquencies led the decline as 30-day and 60-day delinquent inventories are approaching pre-housing crisis levels. The report notes however, that March is historically the month with the largest delinquency declines.

The reduction in refinance activity led to a decline in mortgage originations as rising interest rates and tighter credit requirement means that a majority of homeowners who were eligible to refinance may have already done so.

Other key results from LPS’s Mortgage Monitor report include:

Total U.S. loan delinquency rate (loans 30 or more days past due, but not in foreclosure): 7.78% compared to 8.80% in February 2011

Month-over-month change in delinquency rate: -11.6% compared to -1.2% in February 2011

Year-over-year change in delinquency rate: -19.4% compared to -18.4% in February 2011

Total U.S foreclosure pre-sale inventory rate: 4.21% compared to 4.15% in February

Month-over-month change in foreclosure presale inventory rate: 1.4% compared to -0.2% in February 2011

Year-over-year change in foreclosure presale inventory rate: 11.0% compared to 7.4% in February 2011

Number of properties that are 30 or more days past due, but not in foreclosure: (A) 4,111,000 compared to 4,659,000 in February 2011

Number of properties that are 90 or more days delinquent, but not in foreclosure: 21,989,000 compared to 2,165,000 in February 2011

Number of properties in foreclosure pre-sale inventory: (B) 2,222,000 compared to 2,196,000 in February 2011

Number of properties that are 30 or more days delinquent or in foreclosure: (A+B) 6,333,000 compared to 6,856,000 in February 2011

States with highest percentage of non-current* loans: FL, NV, MS, NJ, GA (FL, NV, MS, NJ, GA in February 2011)

States with the lowest percentage of non-current* loans: MT, WY, AK, SD, ND (MT, WY, AK, SD, ND in February 2011)

*Non-current totals combine foreclosures and delinquencies as a percent of active loans in that state.

Notes:
(1) Totals are extrapolated based on LPS Applied Analytics’ loan-level database of mortgage assets.
(2) All whole numbers are rounded to the nearest thousand.

You can read LPS’ full report on their website.

Tags: LPS, mortgage delinquency rate, foreclosure inventory, non-current loans, foreclosure starts, delinquencies, robo-signing controversy, Mortgage Monitor report