An estimated 7.5 million homeowners are behind on their mortgage or in the foreclosure process, and another 1 million homes are bank-owned (also known as real estate owned or REO) after being foreclosed on by lenders, according to a new report from Lender Processing Services Inc.
The LPS February 2010 Mortgage Monitor report, which is based on data extrapolated from the company’s servicing database, showed that the pace of delinquencies was slowing, but that the U.S. delinquency rate remains at an all-time high of 10.2 percent.
All told, 13.5 percent of active loans were delinquent or in foreclosure, LPS said. The states with the greatest number of non-current loans were Florida, Nevada, Mississippi, Arizona, Georgia, California, Indiana, Michigan and Ohio.
Loan servicers modified the terms of 2 million loans in 2009, including Home Affordable Modification Program (HAMP) trial modifications, LPS said. But an even greater number of loans — 2.5 million — that were current at the beginning of 2009 are now more than 60 days delinquent or in foreclosure, the report said.
The report also showed that loan servicers are waiting longer to foreclose on delinquent loans.
Nearly 23 percent of loans delinquent for 12 months have not been moved to foreclosure status, compared with 9 percent in 2008. More than 31 percent of loans that have been delinquent for six months are not yet in foreclosure, either, the report said.
The average loan age of newly delinquent loans is now 46 months, as compared to an average newly delinquent loan age of 27 months in January 2007. During January 2010, 346,000 borrowers became delinquent for the first time, representing approximately 40 percent of all newly delinquent loans for the month.
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