Distressed Loan Data Improving; Signs of Life for Refinances

While prepayment rates have plummetedrnsince last year they did show some signs of life in April Black KnightrnFinancial Services said today.  While theirrn”First Look” at mortgage data for the month show these rates down 54.47 percentrncompared to April 2013 the rate did rise 8.75 percent from March to a MonthlyrnPrepayment Rate of 0.87 percent.  Thisrnwas the third consecutive monthly increase.  ‘Prepayment‘ refers to how quickly a mortgage is being retired for any reason, but correlates most directly with refinance demand.</p

Aside from what Black Knight termed arnseasonal increase in the early delinquency numbers and a slight bump inrnforeclosure sales, distressed loan data showed continued improvement.  While the number of properties nationwide inrnthe process of foreclosure remains slightly over one million, the foreclosurerninventory dropped by 54,000 in March and is 572,000 below the level one yearrnearlier.  The percentage of propertiesrnwith mortgages in the foreclosures inventory was 2.02 in April, down 5 percentrnfrom March and 36.13 percent compared to the same month in 2013. Foreclosurernsales represented 1.96 percent of loans that were 90 or more days delinquent,rnan increase of 7.17 percent from March and a decrease of 11.41 percent on anrnannual basis.   </p

Foreclosure starts dropped again and arernnow 38.2 percent below where they were in April 2013.   There were 78,000 starts during the month, arn-10.56 change from March.</p

There were 2.82 million mortgage loans</bthat were 30 or more days past due but not in foreclosure in April.  This was 51,000 more than in March but arndecrease of 290,000 from April 2013.  Therndelinquency rate was up 1.84 percent month-over-month but 9.5 percent lowerrnthan a year earlier.  The April delinquencyrnrate was 5.62 percent.   Of thoserndelinquent loans, 1.19 million were more than 90 days past due but not inrnforeclosure, a decline of 12,000 from March and 207,000 from a year earlier.  </p