Fidelity First Funding - Mortgage News

Oct 4 2011, 9:38AM

The August Mortgage Monitor report released on Monday by Lender Processing Services, Inc. (LPS) paints a mixed picture of the
current state of foreclosures in the U.S. It is hard to tell if the situation is improving at the same time the steps necessary to clear
the system are accelerating or if we are starting a new cycle of problems.

Foreclosure starts rose from 207,223 in July to 247,957 in August, an increase of nearly 20 percent, the highest level of the year but a
12 percent improvement from 282,528 starts in August 2010. The foreclosure rate remained at 4.11 percent, identical to the July
figure but up substantially from 3.80 percent one year earlier. Of the quarter million foreclosure starts in August, 35 percent were
repeat starts.

The delinquency rate, which had dropped under 8 percent for the three spring months before rising through June and July fell to
8.13 percent month in August and was down 11.8 percent from the rate one year ago.

There are approximately 4 million loans that are either seriously delinquent (90 or more days) or in foreclosure. The subset that is
seriously delinquent has shrunk to the lowest levels since 2008. Of loans that were current six months previously, 800,000 had
fallen into serious delinquency by August, less than half the 2.92 percent rate at the peak in early 2009. About one-quarter of the
new delinquencies were loans that had never been delinquent before which LPS called a further sign of an improving trend for new
problem loans, however that figure has been almost flat since May. About 667,000 loans rolled from current into 30 day delinquent
status in August, down from close to 800,000 in July.

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