Delinquency rates and incidence of properties in foreclosure
fell again in July, Lender Processing Services (LPS) reports, but more than 4.5
million mortgage loans remain in some category of distress. The company released a preview of its Mortgage Monitor reflecting conditions
at the end of July, a key finding of which was a dramatic year-over-year
decrease in the pre-sale foreclosure inventory.
The pre-sale inventory was down 2.82 percent from June to
July to a total of 1.4 million homes. Since
July 2012 this number has dropped by 30.76 percent. This so-called shadow inventory has been a major
concern of the housing industry since the beginning of the crisis as it was
feared the sheer size of the backlog of homes that might eventually come into
bank ownership would present a significant barrier to recovery.
The delinquency rate, the number of loans that were 30 days
or more past due but not in foreclosure, was down 3.96 percent to 6.41 percent
of U.S. homes with a mortgage. This
represents a -8.76 percent annual reduction in the rate. At the end of July 3.19 million properties
were considered delinquent but not in foreclosure and 1.35 million of those
were seriously delinquent, i.e. 90 or more days past due but not in
Florida, Mississippi, and New Jersey were the states with
the highest percentage of non-current loans in July.
LPS will release the July Mortgage Monitor with the remainder of its July statistics by