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Bank Mortgage Delinquency Down, Foreclosures Up

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Mortgage Daily

                                                 July 13, 2017

The performance of residential loans that are serviced by the nation’s financial institutions improved on a quarter-over-quarter basis. But the number of foreclosures started and finished worsened.

As of the first quarter of this year, 4.4 percent of all
closed-end first-lien mortgages and home-equity loans serviced by banks were delinquent at least 30 days or in the foreclosure process.

The non-current rate
for such bank-serviced assets improved compared to the final quarter of last year, when the rate was 5.3 percent, and the same quarter last year, when it stood at 5.1 percent.

Those were some of the details revealed by the Office of the Comptroller of the Currency in the OCC Mortgage Metrics Report First Quarter 2017.

The report reflects data from mortgages serviced by seven national banks with large servicing portfolios.
Collectively, the banks serviced around 19.484 million loans for $3.416 trillion — or 35 percent of all residential mortgage debt outstanding.

Prime mortgages —
loans underwritten for conforming or jumbo programs — made up 90 percent of servicers’ portfolios.

Another 2 percent were Alt-A loans, those to borrowers with prime credit who don’t qualify for conforming or jumbo programs.

Subprime share was 3 percent. Subprime mortgages are those to borrowers with prior delinquencies, judgments, bankruptcies or foreclosures on their credit report at the time of underwriting.

The remaining 5 percent were not classified.

Included in the latest non-current rate was an 0.7 percent foreclosures-in-process rate, the same as in the fourth-quarter 2016 and down from 0.9 percent in the first-quarter 2016.

The OCC reported that newly initiated foreclosures climbed to 47,500 in the first-quarter 2017 from 45,500 three months earlier but retreated from 58,900 one year earlier.

Foreclosures completed numbered 23,700, more than 20,100 in the final-three months of last year but fewer than 30,200
in the first-three months of last year.

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