Foreclosure Supply Would Take Nearly 52 Months to Sell

June 29, 2011 (Shirley Allen)

The number of mortgages that are more than 90 days delinquent combined with the current foreclosure inventory would take nearly 52 months to clear out at the current rate of sales according to figures released in the May Mortgage Monitor report by Lenders Processing Services (LPS).

LPS reports the combined total of 90 day or more delinquent properties and the current foreclosure inventory totaled 4,084,557 properties at the end of May. With 78,676 foreclosure sales recorded in May, it would take nearly 52 months to clear out the current supply of distressed properties.

May’s data also shows that the disparity in foreclosure sales between judicial and non-judicial states continues to increase as foreclosure inventories in judicial states have increased twice as much as inventories in non-judicial states over the last year.

The biggest drop in foreclosure sales have occurred in judicial East Coast states with declines of 96% in Washington DC, 80% in Maryland, 79% in New York, and 75% in New Jersey. More than 33 percent of the borrowers in foreclosure have not made a payment in over two years.

On the bright side, new problem loans are at 1.27 percent, which is less than half the level experienced during the peak in 2009. Historically, delinquencies are still almost double and foreclosures are eight times higher than normal levels.

Earlier highlights from LPS’s “First Look” report include:

Total U.S. loan delinquency rate (loans 30 or more days past due, but not in foreclosure): 7.96% compared to 7.98% in April 2011

Month-over-month change in delinquency rate: -0.1% compared to 2.4% in April 2011

Year-over-year change in delinquency rate: -18.3% compared to -16.3% in April 2011

Total U.S foreclosure pre-sale inventory rate: 4.11% compared to 4.14% in April 2011

Month-over-month change in foreclosure presale inventory rate: -0.7% compared to -1.6% in April 2011

Year-over-year change in foreclosure presale inventory rate: 12.3% compared to 12.7% in April 2011

Number of properties that are 30 or more days past due, but not in foreclosure: (A) 4,187,000 compared to 4,204,000 in April 2011

Number of properties that are 90 or more days delinquent, but not in foreclosure: 1,921,000 compared to 1,961,000 in April 2011

Number of properties in foreclosure pre-sale inventory: (B) 2,164,000 compared to 2,184,000 in April 2011

Number of properties that are 30 or more days delinquent or in foreclosure: (A+B) 6,350,000 compared to 6,388,000 in April 2011

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

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

Tags: LPS, mortgage delinquency rate, foreclosure inventory, non-current loans

Source:
LPS