Financial institutions saw their collective mortgage servicing portfolio contract by around $39 billion in the second quarter. Delinquency held steady, but the number of completed foreclosures has increased each quarter since late 2008.
Federally regulated banks and thrifts collectively serviced 33,754,791 loans for $5.909 trillion as of June 30, according to the Mortgage Metrics Report released Friday from the Office of the Comptroller of the Currency and the Office of Thrift Supervision.
The aggregate portfolio was higher on March 31 at 33.9 million mortgages serviced for $5.948 trillion and a year ago, when 33,832,014 loans were serviced for $5.969 trillion.
Federally regulated banks and thrifts serviced nearly two-thirds of all U.S. mortgages as of June 30, according to the regulators.
Prime mortgages, those with scores of at least 660, accounted for around 78 percent of outstanding loans where this information was reported. Alt-A loans, loan with borrowers whose scores were at least 620, represented 13 percent of the servicing portfolios. Subprime loans, which were primarily were those with scores less than 620, made up the remaining 9 percent.
Mortgage delinquency of at least 30 days and including foreclosures was 12.7 percent as of the end of June, the same as at the end of March. Delinquency was better a year earlier at 11.4 percent.
Excluding foreclosures, delinquency of at least two months was 6.2 percent, falling from three months prior when it was 6.5 percent but elevating from a year prior’s 5.3 percent. The latest tally reflected a 3.8 percent prime delinquency rate, an Alt-A rate of 11.4 percent and a subprime delinquency rate of 19.4 percent.
The rate of foreclosures in process was 3.4 percent, better than 3.5 percent at the end of the first quarter but higher than 2.9 percent on June 30, 2009.
During the second quarter, 292,072 new foreclosures were initiated, fewer than initiated 370,536 in the prior quarter and 369,226 foreclosures started in the second-quarter of last year.
Foreclosures in process fell to 1,149,770 from 1,170,785 but were higher than last year at the same time, when 992,554 foreclosures were in process.
Completed foreclosures — including short sales and deeds-in-lieu — climbed to 221,474 from 193,882 three months earlier and 132,252 one year earlier. REO filings have risen each period since the fourth-quarter 2008, when 89,638 homes were foreclosed.
On just government mortgages, the total 30-day delinquency rate including foreclosures was 14.7 percent, and the foreclosure rate was 2.7 percent. Mortgages owned or guaranteed by Fannie Mae and Freddie Mac had a total delinquency rate of 8.0 percent and a foreclosure rate of 2.1 percent.
Home-retention actions — including proprietary modification programs and modifications processed under the Home Affordable Modification Program — totaled 504,292 in the second quarter, lower than 642,330 the prior period. Servicers modified 418,531 loans in the second quarter of 2009.
Of loans modified in 2008, nearly one-third were seriously delinquent and 14 percent were in the foreclosure process as of the end of June. Serious delinquency on loans that were modified in 2009 was 28 percent, while the foreclosure rate was 9 percent.
Nearly half of all modified loans serviced were at least 60 days delinquent within one year of being modified. But the default rate was just over one-third on portfolio loans.