BAP Blog MBA Survey: Delinquencies Rise, Foreclosures Fall

The Mortgage Bankers Association’s (MBA) National Delinquency Survey is reporting that the delinquency rate for mortgage loans on one-to-four-unit residential properties increased to a seasonally adjusted rate of 8.44 percent of all loans outstanding as of the end of the second quarter of 2011. As reported this is an increase of 12 basis points from the first quarter of 2011, and a decrease of 141 basis points from one year ago. The non-seasonally adjusted delinquency rate increased 32 basis points to 8.11 percent this quarter from 7.79 percent last quarter. Also reported was that the percentage of loans on which foreclosure actions were started during the second quarter was 0.96 percent, down 12 basis points from last quarter and down 15 basis points from one year ago. The delinquency rate includes loans that are at least one payment past due but does not include loans in the process of foreclosure. The percentage of loans in the foreclosure process at the end of the second quarter was 4.43 percent, down 9 basis points from the first quarter and 14 basis points lower than one year ago. The serious delinquency rate, the percentage of loans that are 90 days or more past due or in the process of foreclosure, was 7.85 percent, a decrease of 25 basis points from last quarter, and a decrease of 126 basis points from the second quarter of last year. The combined percentage of loans in foreclosure or at least one payment past due was 12.54 percent on a non-seasonally adjusted basis, a 23 basis point increase from last quarter, but was 143 basis points lower than a year ago. Foreclosure start rates fell to their lowest level since the fourth quarter of 2007 plus the Foreclosure inventory rates also fell to their lowest level since the third quarter of 2010. The percentage of loans 90 days or more past due continues to fall along with the foreclosure rate, and is at the lowest point since the beginning of 2009. Were there a growing backlog, we would expect to see the 90-plus day delinquent category increasing. The percent of loans in foreclosure also decreased nine basis points overall to 4.43 percent. The foreclosure inventory rate for prime fixed loans decreased three basis points to 2.56 percent. The rate for prime ARM loans decreased 37 basis points from last quarter to 9.16 percent. The rate for subprime ARM loans decreased three basis points to 22.23 percent and the rate for VA loans decreased nine basis points to 2.30 percent. The rate for FHA loans decreased 11 basis points to 3.24 percent. Subprime fixed loans saw an increase of 48 basis points to 11.01 percent, which sets a record high in the survey for three straight quarters. Also the non-seasonally adjusted foreclosure starts rate decreased six basis points for prime fixed loans to 0.62 percent, 14 basis points for prime ARM loans to 1.82 percent, 12 basis points for subprime fixed to 2.44 percent and five basis points for subprime ARMs to 3.62 percent. The foreclosure starts rate decreased 20 basis points for FHA loans to 0.73 percent and 18 basis points for VA loans to 0.55 percent.