Even Bad News is Good in September Foreclosure Summary

September appears to have been anotherrnmonth in which loan performance improved and the states continued to slogrnthrough the overhang of delinquent mortgages left over from, in some cases, thernearly days of the housing crash.  BlackrnKnight Financial Services released a “first look” at its data for the monthrnshowing overall improvement in delinquency and foreclosure metrics.</p

The inventory of delinquent loans -rnthose for which one or more payments have been missed but the loan is not yetrnin foreclosure – declined by 3.90 percent or 117,000 loans in September, nearlyrnreversing a huge 146,000 delinquent loan increase in August.  This brought the 30+ day rate down to 5.67rnpercent and was a 12.22 percent drop representing 388,000 fewer loans comparedrnto September 2013.</p

Of the 2.88 million loans that wererndelinquent at the end of September, 1.12 million were seriously so, that is 90rnor more days delinquent but not yet in foreclosure.  This number was down 25,000 from August and 213,000rnfrom one year earlier.</p

There were 893,000 loans in some stagernof foreclosure at the end of September, down 20,000 from the previous month andrn435,000 fewer loans than in September 2013. rnThe national foreclosure inventory rate was 1.76 percent of allrnmortgaged homes, a -2.20 percent change from August and down almost exactlyrnone-third from the previous September. rnThe foreclosure inventory at the end of September was at its lowest levelrnsince February 2008.</p

Non-performing loans, the total of thosernthat were more than 30 days past due or in foreclosure was 3.77 million at thernend of September, a decrease of 137,000 loans month-over-month and 822,000rnyear-over-year.</p

Two of Black Knights data pointsrnincreased, but even that is not all bad news as it indicates that states arernmaking progress in reducing the backlog of distressed loan inventory.  There were 91,000 foreclosure starts duringrnthe month, 11.52 percent more than in August although they were down 16.51rnpercent from a year earlier.  Foreclosurernsales also increased slightly, to 1.80 percent of those loans delinquent overrn90 days, up 4.60 percent from August.</p

The states with the highest percentagernof non-current loans in September were Mississippi (14.41 percent), New Jerseyrn(12.17 percent), Louisiana (11.16 percent), New York (10.76 percent), andrnFlorida (10.55 percent) All five states had a significantly lower percentage ofrnnon-performing loans than a year earlier and in the case of Florida thatrnpercentage was down by nearly one-third.</p

Black Knight will release its monthlyrnMortgage Monitor containing more loan level data for September on November 3.

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