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27 » VISIT US ONLINE @ DSNEWS.COM FORECLOSURE RATE DOWN TO 2.5% AT YEAR-END Last year saw "significant, sustained" improvements in both delinquency and foreclosure numbers, according to Black Knight Financial Services (BKFS). e company's data and analytics division released its year-end Mortgage Monitor Report, which builds on its recently released "first-look" stats for the year. According to the report, 6.47 percent of the nation's mortgages last year were delinquent, down from a peak of 10.57 percent in January 2010 and about 1.5 times the pre-crisis average of 4.27 percent (in December 2005). It was the fourth straight year of improvements. Meanwhile, about 2.48 percent of loans were in some state of foreclosure—a rate about 4.6 times the pre-crisis average. "In many ways, 2013 marked an abatement to crisis conditions in the U.S. mortgage market," said Herb Blecher, SVP of BKFS' data and analytics group. "Delinquencies neared pre-crisis levels, foreclosure inventory declined 30 percent over the year, new problem loan rates improved in both judicial and non-judicial foreclosure states, and foreclosure starts ended the year at the lowest level since April 2007." While transactions slowed in the later months, Blecher noted 2013 "was also the best year for property sales since 2007, with totals through November outnumbering the full-year totals for each of the prior three years." ough sales and prices improved nationally—with prices coming up 8.5 percent year-over-year as of November—the company observed a gap in the recovery rates of judicial versus non-judicial states, with judicial areas seeing slower growth. e same trend was observed in negative equity improvement. "With 75 percent of loans that are either seriously delinquent or in foreclosure being 'underwater,' the resolution of these inventories in many regions (and the speed at which that has occurred) has had a pronounced effect on reducing overall negative equity numbers," Blecher remarked. In addition, BKFS' year-end data shows that even in states with judicial slowdowns, foreclosure pipelines have been clearing over the latter half of 2013. Overall, judicial states' foreclosure inventories still remain 3.5 times bigger than those in non-judicial states, however. FANNIE MAE'S BOOK SHRINKS AS NEW BUSINESS FALLS Fannie Mae's book of business shrank in December, ending a short streak of growth and marking the eighth month of 2013 in which business slowed. According to the GSE's monthly volume summary, business contracted at a compounded annual rate of 0.4 percent in December, bringing the full-year growth rate to -0.8 percent. e total book of business was valued at about $3.16 trillion as of the end of 2013. Fannie Mae's gross mortgage portfolio also shrank in December for the 12th straight month as commitments to purchase fell nearly $10 billion to $37.7 billion. e portfolio totaled $490.7 billion as of year-end. New business acquisitions in December came to $39.7 billion, down from $42 billion in November. For the entire year, acquisitions totaled $796.6 billion. Delinquency rates continued to trend downward. According to the company, the single-family serious delinquency rate was down 6 basis points in December to 2.38 percent, while the multifamily serious delinquency rate fell 1 point to 0.1 percent. e GSE reported 13,815 loan modifications in December, bringint the 2013 total to 160,007 modifications. Start your day with a professional pick-me-up. Start your day with the most current and critical news on the mortgage default servicing industry from DSNews.com. Sign up for our e-mail newsletter and get the top stories delivered direct to your inbox every day. Register to receive your Daily Dose at DSNews.com