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The average loan in foreclosure today has not seen a payment for 587 days, a new record and the total of loans in foreclosure or seriously delinquent now is 12.8 percent higher than last year.

Foreclosure Timeline Soars to 587 Days

The average loan in foreclosure today has not seen a payment for 587 days, a new record and the total of loans in foreclosure or seriously delinquent now is 12.8 percent higher than last year.

Delays in processing foreclosures are continuing to drive up foreclosure processing timelines at the same time that new foreclosures jumped 10 percent in June, according to the June Mortgage Monitor report by Lender Processing Services, Inc., but are still down 16.4 percent from the start of the year

Delinquencies were also up, but incrementally, showing a 2.4 percent increase over May. As of the end of June, 4.1 million loans were either 90+ days delinquent or in foreclosure, representing a 12.8 percent increase since June 2010.

More than 40 percent of mortgages delinquent more than 90 days have not seen a payment in more than a year. For loans in foreclosure, 35 percent have been delinquent for more than two years.

Looking at the differences between judicial and non-judicial foreclosure states, the LPS data shows that the foreclosure pipeline ratio – that is, the number of loans either 90+ days delinquent or in foreclosure divided by the six-month average of foreclosure sales – is more than three times as high for judicial foreclosure states. Additionally, the slowdown associated with foreclosure moratoria has been almost exclusively felt in judicial states.

LPS also examined historical data to estimate the potential impact of the proposed Qualified Residential Mortgage (QRM) provision of the Dodd-Frank Bill. The data shows that, since 2005, nearly half of all loans originated in the United States could have been ineligible under QRM. At the same time, LPS found that the potential impact of the Federal Housing Finance Agency (FHFA) high-cost conforming limit expiration would be minimal, accounting for only one percent of originations over the last three years.

The total U.S. loan delinquency rate is now 8.15 percent. Month-over-month change in delinquency rate is 2.4. Total U.S. foreclosure pre-sale inventory rate: 4.12 percent. Month-over-month change in foreclosure pre-sale inventory rate: 0.2 percent.

States with highest percentage of non-current loans: FL, NV, MS, NJ, IL. States with the lowest percentage of non-current loans: MT, WY, AK, SD, ND.

9 comments

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