Past Due Mortgages = 6,298,000

There were 6,298,000 mortgages going unpaid in the United States as of the end of October, according to Lender Processing Services (LPS).

It’s a daunting number, but the data show that it’s actually been on a fairly steady decline for nearly two years now.
At the start of 2011, the total number of non-current mortgages in the U.S. stood at 6,870,000. In January 2010, it was 8,118,000.

LPS’ more recent reports show the industry is slowly but surely chipping away at the number each and every month – the result of both loss mitigation workouts and removing loans that cannot be resolved from the inventory through foreclosure.

At September month-end, the tally of non-current mortgages was 6,373,000. It was 6,397,000 at the end of August and 6,538,000 at the end of July.

LPS’ data indicates mortgage delinquencies are declining while the nation’s foreclosure inventory is growing.
Of the 6,298,000 loans past due at the end of October, 2,329,000 were behind on their payments by 30-89 days and 1,759,000 were 90 or more days delinquent but not yet referred to foreclosure.

Combined, these tallies represent 7.93 percent of the nation’s outstanding mortgages that are delinquent but not in foreclosure. The October delinquency rate is down 2.0 percent from the previous month and is 14.6 percent lower than the rate recorded in October 2010.

The foreclosure inventory rate, on the other hand, is up by both measures. LPS says 4.29 percent of the nation’s mortgages are winding their way through the foreclosure process, a month-over-month increase of 2.5 percent and a year-over-year increase of 9.4 percent.

By LPS’ calculations, there were 2,210,000 residential mortgage loans in foreclosure at October month-end.
States with highest percentage of non-current loans – which combines foreclosures and delinquencies – include: Florida, Mississippi, Nevada, New Jersey, and Illinois.

Montana, Wyoming, South Dakota, Alaska, and North Dakota have the lowest percentage of non-current loans.

This article is from DSnews.com.


Freddie Mac's Winter REO Sales Promo Pays Extra to Selling Agents

Freddie Mac has announced the launch of a nationwide winter sales promotion to move its inventory of foreclosed homes and put them back into the hands of responsible homeowners purchasing a primary residence.

HomeSteps, the GSE’s REO sales division, will pay selling agents a $1,000 bonus for offers received on Freddie Mac-owned homes in select locations.

Initial offers must be received between November 15, 2011 and January 31, 2012 with escrow closed on or before March 15, 2012. The offer is valid only on HomeSteps homes sold to owner-occupant buyers.

Selling agent bonuses will be offered on HomeSteps sales in the District of Columbia and the following 28 states: Colorado, Connecticut, Delaware, Iowa, Idaho, Illinois, Indiana, Massachusetts, Maryland, Maine, Michigan, Minnesota, Montana, North Dakota, Nebraska, New Hampshire, New Jersey, New York, Ohio, Pennsylvania, Rhode Island, South Dakota, Utah, Virginia, Vermont, Wisconsin, West Virginia, and Wyoming.

The GSE is also extending additional incentives to its owner-occupant buyers. Throughout the winter sales promotion, HomeSteps will pay up to 3 percent of the final sales price towards the buyer’s closing costs.
Some HomeSteps homes are also eligible for a two-year Home Protect limited warranty that covers electrical, plumbing, air conditioning, heating, and other major systems and appliances. Home Protect also provides discounts of up to 30 percent on appliance purchases.

Freddie Mac held 59,596 single-family REO homes as of the end of September. According to the company, its HomeSteps properties accounted for about 4.4 percent of the nation’s inventory of foreclosed homes as of September 30, 2011.
The GSE says the pace of REO acquisitions remains slow due to continued delays in the foreclosure process – delays the company expects will continue into 2012. Freddie Mac acquired 24,385 REO homes through foreclosure during the third quarter of this year.

Currently, the GSE is selling more homes than it’s taking in. REO sales totaled 25,387 over the third quarter period.
Seventy-percent percent of HomeSteps homes are purchased by buyers intending to live in the homes as owner-occupants. Freddie Mac says its REOs sell for an average of 94 percent of the estimated market price.

This article is from DSnews.com.


Housing Market On the Rise in 2012, Expert Says

Gradual improvement in the housing market is expected next year, with existing-home sales edging up 4% to 5% and new home sales getting an even bigger boost off this year’s record lows, the chief economist of the nation’s largest real estate group said Friday.

“Tight mortgage credit conditions have been holding back homebuyers all year, and consumer confidence has been shaky recently,” Lawrence Yun, chief economist of the National Association of Realtors, said. “Nonetheless, there is a sizeable pent-up demand based on population growth, employment levels and a doubling-up phenomenon that can’t continue indefinitely.”

Yun, who made his comments during the annual NAR conference for real estate agents under way in Anaheim, Calif., projected gross domestic product growth of 1.8% for 2011, rising to 2.2% in 2012 with the unemployment rate declining to 8.7% by the second half of 2012.

Mortgage interest rates, he predicted, would gradually rise from record 2011 lows to 4.5% by the middle of 2012.

This article is from AOL Real Estate.


Mortgage-Related Jobs Are on the Rise: Report

The third quarter of 2011 saw a net increase of 2,738 mortgage-related jobs, according to recent industry data. This increase is the first recorded in five quarters.

The recent increase in refinances – encouraged by remarkably low interest rates – sparked a demand for loan originators and processors, while continuing high levels of delinquencies and foreclosures bolstered the need for servicing staff.

The third quarter saw 2,502 layoffs countered by 5,240 hirings, according to the Third-Quarter 2011 Mortgage Employment Index released by MortgageDaily.com.

The 2,738 gain compares to a net loss of 464 jobs in the previous quarter and a loss of 936 jobs a year ago.
JPMorgan Chase was a major source of the rise in hirings in the third quarter with 3,314 hirings of its own.
MetLife added 351 jobs, and CashCall Mortgage added 230.

Wells Fargo (-686), CoreLogic (-600), and Bank of America (-364) all lost jobs during the quarter.
California-based CoreLogic anticipates about 1,000 layoffs during the second half of 2011, according to MortgageDaily.com.

With an increase of 699 mortgage-related jobs, Texas posted the largest increase, and according to the index, “[t]he Dallas area has become a Mecca for mortgage servicers.”

Iowa, on the other hand, saw a decrease of 159 positions, largely due to Wells Fargo’s downsizing.
So far, the fourth quarter is seeing more hirings than layoffs.

This article is from DSnews.com.


Economist: ARMs Not as Risky as Some Think

Long-term, fixed-rate mortgages are often seen as a “safe” loan product, but one Federal Reserve economist says adjustable-rate mortgages (ARMs) are not as risky as some perceive them to be and did not play a major role in the recent housing crisis. To those who believe payment shocks caused by ARMs were a major player in the foreclosure crisis, Paul Willen, senior economist at the Federal Reserve Bank of Boston, says, “The data refute that theory.” Willen shared his views before the Senate Banking Committee at a hearing titled “Housing Finance Reform: Continuation of the 30-year Fixed-rate Mortgage.”

In a survey of 2.6 million foreclosures, Willen found mortgage payments at the time of foreclosure were the same or lower than the initial payment for 88 percent of the mortgages.

Those with ARMs “were almost as likely to have seen a payment reduction as a payment increase” says Willen because interest rates in any recession – including the recent one – fall rather than rise. Only 12 percent of foreclosed borrowers experienced payment shock, according to Willen. More than half of borrowers whose homes were foreclosed – 60 percent – had fixed-rate mortgages. Willen points to falling prices combined with life events, rather than payment shock, as the major proponent of the foreclosure crisis.

When borrowers have positive equity, it makes more financial sense for them to sell their property than default on their mortgage when they encounter a negative life event such as job loss, divorce, or illness. However, when prices fall and borrowers have negative equity, disruptive life events are much more likely to lead to foreclosure, Willen says in his testimony.

“It does turn out that fixed-rate mortgages default less often than adjustable-rate mortgages, but that fact reflects the selection of borrowers into fixed-rate products, not any characteristics of the mortgages themselves,” Willen says. He suggests that some ARM borrowers enter their mortgages without intending to stay in the homes long-term. When these borrowers’ home values fall, they are more likely to default, according to Willen.

Article is from DSnews.com.