Foreclosure starts continue to accelerate with the GSEs displaying more aggressive timelines on early stage delinquencies.
By the end of August, there had been more than 2 million foreclosure starts, while delinquencies during that same time period dropped 5.1% compared to a year ago, according to the August Mortgage Monitor report by Lending Processing Services, Inc.
Breaking the trend of the last three months, agency foreclosure starts declined slightly in August; however, portfolio foreclosure starts have accelerated.
LPS says late stage delinquencies dominate these new foreclosure starts, though overall the percentage of seriously delinquent loans not in foreclosure is improving as compared to the extreme distress seen last year.
In January 2009, the percentage of seriously delinquent loans that were current six months prior peaked at 2.92%. In August 2010, that rate was 1.65%.
The total U.S. loan delinquency rate was 9.22%, and the foreclosure inventory rate was 3.8%.
The report also shows that approximately 1.01 million loans that were current at the beginning of January are at least 60 days delinquent or in foreclosure as of the end of August – a month-over-month increase of 115,000 loans.
LPS data also show refinance activity is picking up again as prepayment rates have been steadily increasing over the last two months and new originations hit 2010 highs.
States with most non-current loans, which combine foreclosures and delinquencies as a percentage of active loans in particular states, included Florida, Nevada, Mississippi, Georgia, and Illinois.
States with the fewest non-current loans were North Dakota, South Dakota, Alaska, Wyoming and Montana.
