Shadow inventory volume has been decreasing progressively in the last several months, but it does not appear this portfolio of loans will fully clear for at least another couple of years.

The volume of distressed nonagency mortgages dropped in 2013 to less than half of what it was at its peak in February 2010. As of November 2013, $232 billion of nonagency mortgages remain in the shadow inventory, down from $495 billion in the beginning of 2010.

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