Wondering how many mortgages went bust last year?
That’s more than double the $126.7 billion written off in 2006 and 2007 combined.
And it’s no wonder, considering most of the soured mortgages and home equity loans were from those later years, when home prices were bloated and mortgage financing was seemingly a free-for-all.
In fact, analysis from Equifax found that there are roughly $319.7 billion in 2006 and 2007 first mortgage vintages still in the initial foreclosure process.
These have yet to be written off, but when they are, they’ll add to the shadow inventory, putting more downward pressure on home prices.
Nearly two-thirds of past-due mortgages were loans originated between 2005 and 2007.
Meanwhile, roll rates continue to rise on 60 and 90+ past due mortgages, meaning mortgage payment performance continues to suffer, despite a drop in new delinquencies.
In other words, those loan modifications executed after borrowers are behind on payments aren’t accomplishing a whole lot.
Overall, three percent of all first mortgages, or $21.8 billion in loan balances, were REO properties (bank-owned) in May.