The Week Ahead: Will Foreclosures Fall Even Further?

According to the April 2016 National Foreclosure Report released by CoreLogic, the nation's foreclosure rate and serious delinquency rate fell to post-crisis lows amid home price appreciation and labor market improvements. On Tuesday, July 12, the industry will find out how much further those numbers fell when CoreLogic releases its May 2016 National Foreclosure Report.

CoreLogic found in the April report that foreclosure inventory, or the number of residential homes that are in some state of foreclosure, declined by 23.4 percent over-the-year to about 406,000 homes—representing about 1.1 percent of all homes with a mortgage. The 1.1 percent foreclosure rate was the lowest for any one month since September 2007.

Additionally, the number of seriously delinquent mortgages, being mortgages that are 90 days or more overdue or in foreclosure or REO, also fell by 21.6 percent, as did the serious delinquency rate by 3 percent, the lowest for any one month since October 2007. The number of completed foreclosures for April totaled approximately 37,000, which is a decline of about 15.8 percent from April 2015’s total of 43,000.

“The recovery in home prices and improved labor market have contributed to the drop in seriously delinquent rates,” said Dr. Frank Nothaft, chief economist for CoreLogic. “Over the 12 months through April, the CoreLogic Home Price Index for the U.S. rose 6.2 percent and the labor market gained 2.6 million jobs. We also found that the seriously delinquent rate fell by about three-quarters of a percentage point.”

HUD Accountability Hearing, Full House Financial Services Committee Hearing, Wednesday, July 13, 10 a.m EST

Rep. Jeb Hensarling (R-Texas), Chairman of the House Financial Services Committee, on Thursday asked for HUD Secretary Julián Castro to appear before his Committee to answer questions about the effect of recent changes to HUD’s delinquent loan sales program on taxpayers. The HUD Secretary accepted the invitation and will testify in a committee before the full House Financial Services Committee on Wednesday.

“Secretary Castro was told months in advance that changes harming taxpayers would result in a congressional hearing, and we’re simply following through,” Hensarling said. “Hardworking taxpayers deserve to know why Secretary Castro suddenly decided to expose them to greater losses and worsen the nation’s already unsustainable national debt. The changes he’s making rig the program so certain buyers approved by Washington elites can receive steep discounts on properties and leave taxpayers holding the bag. There have been several media reports that these changes are motivated not by what’s best for taxpayers, but by what’s best for the Secretary’s future ambitions. The timing and impact of these changes certainly raise legitimate questions that need to be answered.”

Castro said in response to Hensarling's request, “I want to thank Chairman Hensarling for his invitation to speak about the recent improvements the Federal Housing Administration made to the Distressed Asset Stabilization Program.  I look forward to answering the Committee’s questions about how this program is providing the greatest opportunity for struggling homeowners to remain in their homes while protecting FHA’s single-family insurance fund.”

This Week's Schedule

Tuesday, July 12

May 2016 National Foreclosure Report, CoreLogic

Wednesday, July 13

HUD Accountability Hearing, House Financial Services Committee, 10 a.m. EST

Thursday, July 14

JPMorgan Chase Q2 earnings report

Friday, July 15

Q2 earnings reports for Citi, PNC, U.S. Bank, and Wells Fargo