Mortgage delinquencies posted their largest year-to-date drop since 2002, Lender Processing Services reports. Delinquencies fell 15 percent during the end of December 2012 to May 2013.
New problem loan rates are approaching the pre-crisis average, says Herb Blecher, LPS Applied Analytics senior vice president.
“Though they are still approximately 1.4 times what they were, on average, during the 1995 to 2005 period, delinquencies have come down significantly from their January 2010 peak, Blecher notes. In large part, this is due to the continuing decline in new problem loans — as fewer problem loans are coming into the system, the existing inventories are working their way through the pipeline. New problem loan rates are now at just 0.73 percent, which is right about on par with the annual averages during 2005 and 2006, and extremely close to the 0.55 percent average for the 2000-2004 period preceding.”
The delinquency rate is 4 percentage points below the peak of the mortgage crisis in January 2010, LPS reports. What’s more, delinquencies of prime mortgages have fallen nearly 50 percent since the 2010 peak.
LPS says that foreclosure starts fell to their lowest number in May in the last 12 months.
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