Delinquency rates in the U.S. have now surpassed 10%, according to Lender Processing Services Inc.'s (LPS) January 2010 Mortgage Monitory report. Factoring in foreclosures in process, according to the data in LPS' database, the total non-current rate sits at 13.3%.
When extrapolated to reflect the entire mortgage industry, this rate indicates that more than 7.2 million mortgage loans are now behind on payments, LPS says. In addition, an estimated 1 million properties are now owned by banks. The January report is based on data collected as of Dec. 31, 2009.
Within the population of loans that were current as of year-end 2008, the percentage of ‘new’ serious delinquencies is 4.64% – higher than any other year analyzed for the same period. Of loans that were current as of Dec. 31, 2008, by December 2009 there were 2.3 million new loans that were considered seriously delinquent.
Prime loans, including agency, non-agency and jumbo, have experienced deterioration at a worse pace on a relative basis than subprime, Federal Housing Adminsitration and all loans as a whole. Within the prime loans category, loans with current unpaid principal balances between $417,000 and $600,000 have performed the worst.
The Mortgage Monitor report also indicates that 2009 vintage loans are performing better than loans from any of the prior five years and have been steadily improving as more origination months are added to the pool of loans. LPS attributes this improvement to more restrictive underwriting guidelines. The report also noted that liquidity is still not available where it is needed most.
SOURCE: Lender Processing Services Inc.