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» VISIT US ONLINE @ DSNEWS.COM The destination for brilliant results. FEATURED SERVICES: PROPERTY PRESERVATION TITLE SERVICES PROPERTY MANAGEMENT ASSET MANAGEMENT Find us online at pemco-limited.com REGULATOR FINDS MORTGAGE PERFORMANCE IMPROVED IN Q4 A higher share of mortgages were current and performing at the end of the fourth quarter of 2012, while the number of new foreclosures hit a record low, the Office of the Comptroller of the Currency (OCC) revealed in its latest Mortgage Metrics Report. As of the end of December, 89.4 percent of mortgages were current and performing, up from 88.6 percent in the third quarter and 88 percent in the fourth quarter of 2011. Servicers also initiated fewer foreclosure actions, with 156,773 new foreclosures in Q 4. That's the fewest foreclosure starts over a threemonth quarterly period since Q1 2008, which is when the OCC began issuing its Mortgage Metrics Report. In addition, the number of loans in the foreclosure process ended the year below the one million mark, a first since the end of June 2009. The fourth-quarter figure for loans in foreclosure totaled 967,467, down 16.5 percent from the previous quarter and 23.4 percent from a year earlier. Completed foreclosures were also down and fell to 105,875, a 7.7 percent decrease from the third quarter and an 8.9 percent drop from the year before. The OCC report is based on first-lien mortgages serviced by selected national and federal savings banks. The portfolio includes 29 million loans and represents 57 percent of all mortgages outstanding in the country. The OCC also found the number of loans in the portfolio delinquent 60 or more days fell by 288,064 in Q 4 2012 to 4.4 percent. That rate represents a quarterly and yearly decrease of 1.1 percent and 11.6 percent, respectively. The percentage of mortgages that were 30 to 59 days past due stood at 2.9 percent, which represents a decline of 8.2 percent from Q 3 2012 and a 6.1 percent decrease from Q 4 2011. According to the OCC report, a number of factors led to the improvement in loan performance, such as "strengthening economic conditions, the ongoing effects of both home retention efforts and home forfeiture actions, and servicing transfers to institutions outside the federal banking system." Servicers helped borrowers remain in their homes by implementing more home retention actions—such as modifications and trialperiod plans—than home forfeiture actions, including completed foreclosures, short sales, and deeds-in-lieu. Over the three-month period ending with December 2012, servicers completed 367,169 home retention actions compared to 169,064 home forfeiture actions. Servicers slowed the pace at which they implemented home retention actions, which decreased quarterly and annually by 4.1 percent and 20.2 percent, respectively. Home forfeiture actions also slowed, decreasing by 6.2 percent from the third quarter and by 7.3 percent from a year earlier. Of fourth-quarter home forfeiture actions, foreclosures numbered 114,742, while 61,761 actions were short sales. Meanwhile, loan modifications accounted for 114,324 of the home retention options. The OCC also tracked modification performance over the last five quarters and found after three months, between 6.5 percent and 8.1 of modified loans had missed two payments. Six months after modification, 12.5 percent to 14.1 percent of loans were at least 60 days past due, and the range was even greater after 12 months at 21.9 percent to 22.2 percent. 29

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