LPS Mortgage Monitor - June 2012

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LPS Mortgage Monitor - June 2012

  1. 1. ONE SOURCE. POWERFUL SOLUTIONS. : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : LPS Mortgage Monitor July 2012 Mortgage Performance Observations Data as of June, 2012 Month-end Lender Processing Services 1
  2. 2. June 2012 “First Look”McDash Online Release: July 16th Lender Processing Services 2
  3. 3. DQs are down over 30% from peak; FCs still near all-time highs Lender Processing Services 3
  4. 4. Non-judicial non-current ratescontinue to decline faster than judicial Average year over year change in non-current percent (includes loans 30+ Delinquent or in Foreclosure) Judicial =0.2% Non-judicial =-6.2% Lender Processing Services 4
  5. 5. New problem loan rates areslightly higher in judicial states Lender Processing Services 5
  6. 6. 90+ delinquent inventory rateis now higher in judicial states Lender Processing Services 6
  7. 7. National 90+ DQs stable, % of agedinventory is higher in judicial states Lender Processing Services 7
  8. 8. Cures are seasonally low;modification activity is limited Lender Processing Services 8
  9. 9. First time foreclosure starts are at multi-year lows Lender Processing Services 9
  10. 10. Judicial and non-judicialforeclosure starts have diverged Lender Processing Services 10
  11. 11. Foreclosure inventory in judicial states is over 3x non-judicial Lender Processing Services 11
  12. 12. Almost 60% of judicial foreclosureshave not made a payment in 2 years Lender Processing Services 12
  13. 13. Foreclosure starts still outnumber sales by over 2:1*Foreclosure sales figures include short sales and other involuntary liquidations Lender Processing Services 13
  14. 14. Foreclosure sales have been slowly increasing in judicial states Lender Processing Services 14
  15. 15. Pipeline rations in judicial states have improved Lender Processing Services 15
  16. 16. Prepayment speeds remain stable despite historically low rates Lender Processing Services 16
  17. 17. HARP activity has jumped sharply since January Lender Processing Services 17
  18. 18. Refi opportunities have extended to lower credit score borrowers Lender Processing Services 18
  19. 19. Origination activity is stable, closely tracking refinance trends Lender Processing Services 19
  20. 20. ONE SOURCE. POWERFUL SOLUTIONS. : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : LPS Mortgage Monitor Disclosures: Product / Metric Definitions and July 2012 Market Sizing Revisions Lender Processing Services 20
  21. 21. Disclosure Page: Product Definitions *Conforming limits do not account for temporary or high-cost area increases. Lender Processing Services 21
  22. 22. Disclosure Page: Metrics Definitions• Total Active Count: All active loans as of month-end including loans in any state of delinquency or foreclosure. Post-sale loans and loans in REO are excluded from the total active count.• Delinquency Statuses (30, 60, 90+, etc): All delinquency statuses are calculated using the MBA methodology based on the payment due date provided by the servicer. Loans in foreclosure are reported separately and are not included in the MBA days delinquent.• 90 Day Defaults: Loans that were less than 90 days delinquent in the prior month and were 90 days delinquent, but not in foreclosure, in the current month.• Foreclosure Inventory: The servicer has referred the loan to an attorney for foreclosure. Loans remain in foreclosure inventory from referral to sale.• Foreclosure Starts – Any active loan that was not in foreclosure in the prior month that moves into foreclosure inventory in the current month.• Non-Current: Loans in any stage of delinquency or foreclosure.• Foreclosure Sale / New REO: Any loan that was in foreclosure in the prior month that moves into post-sale status or is flagged as a foreclosure liquidation.• REO: The loan is in post-sale foreclosure status. Listing status is not a consideration, this includes all properties on and off the market.• Deterioration Ratio: The ratio of the percentage of loans deteriorating in delinquency status vs. those improving. Lender Processing Services 22
  23. 23. With the June 2012 month-end data, LPS has updated itsextrapolation methodology to incorporate, among otherthings, improved estimates of market size, which includeshigher coverage of government and subprime products andincreases LPS’ estimate of the total first lien residentialmortgage market by three percent to 50.4 million.To ensure consistency in trend analysis, the newmethodology has been applied to all historical data andpreviously reported mortgage performance statistics havebeen adjusted accordingly.The following section contains information on marketcoverage and comparisons with previously reportedstatistics. Additional information is available upon request. Lender Processing Services 23
  24. 24. The new scaling increases overall estimated industry loan count by approximately 1.2 million loans Prior industry estimates declined because scaling didn’t support current servicing transfer volumes Lender Processing Services 24
  25. 25. New scaling reflects the higher coverage of governmentloans and allows for the incorporation of new servicers Lender Processing Services 25
  26. 26. Delinquencies decline based on higherestimated coverage of FHA and subprime loans. Converge due to new servicers and transfer issues with prior scaling Lender Processing Services 26
  27. 27. Foreclosure inventory remains almost identical, butshifts up in recent months as transfer bias is repaired Lender Processing Services 27
  28. 28. Foreclosure starts remain consistent, with rates shifting up slightly Lender Processing Services 28
  29. 29. Performance Statistics Changes: Database Counts Lender Processing Services 29
  30. 30. Performance Statistics Changes: State Level Detail Lender Processing Services 30

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