Mortgage delinquencies increased 2.3 percent month-to-month to a rate of 9.20 percent in May, according to the latest Mortgage Monitor report from Lender Processing Services.
At the same time, deterioration ratios increased after a two-month decline, with 2.5 loans rolling into a more severe status for every single loan that improved.
Translation: one step forward, 2.5 steps back.
The number of delinquent loans that “cured,” or became current, declined for every stage of delinquency except the “greater than six months delinquent” category, which LPS attributed mainly to loan modifications completed via HAMP.
And we all know how well those are performing…
All that said, the report also noted that the average number of days for a loan to move from 30-day late status to foreclosure sale continues to rise.
It’s now at a whopping 449 days, an all-time high – possibly good for struggling homeowners, but bad for the fragile housing market and the growing shadow inventory.
LPS said the foreclosure inventory rate was 3.18 percent at the end of May, meaning the total non-current loan rate in the US was 12.38 percent.
It’s highest in states like Florida, Nevada, Mississippi, Georgia, Arizona, California, and Ohio.
And lowest in states like Wyoming, Alaska, Montana, Vermont, Nebraska, and the Dakotas.