OCC: 88% of First-lien Mortgages at Large Banks Are Performing

First-lien mortgage performance among large national banks' servicing portfolios is stabilizing, with 88 percent current after decreasing by 0.1 percent over the third quarter of this year, according to the Office of the Comptroller of the Currency (OCC).

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Delinquencies â€" both early stage and serious delinquencies â€" remained unchanged over the quarter.

The percentage of loans 30 days to 59 days delinquent stood at 3 percent, while those 60 or more days delinquent stood at 4.9 percent for the quarter.

However, new foreclosures rose 21.1 percent bringing the total number of loans in foreclosure to about 1.3 million â€" 4.1 percent of the total loans observed by the OCC.

Performing loans made up 93.1 percent of the GSEs' portfolio, unchanged from the previous quarter.

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The number of home retention actions â€" modifications, trial period plans, and payment plans â€" completed by the industry in the third quarter was 0.6 percent higher than the previous quarter but 2.4 percent lower than last year.

On average, mortgage modifications included 24.4 percent reductions in monthly principal and interest payments, lowering monthly payments by about $383.

HAMP modifications included greater reductions â€" 35.1 percent decreases, saving borrowers $567 per month.

In total, 90 percent of all modifications completed during the third quarter included reduced monthly payments.

The OCC reported 77.5 percent of all modifications came with reduced interest rates; 20.5 percent included principal deferrals; and 7.8 percent included principal reductions.

Of modifications through HAMP, 86.8 percent included reduced interest rates; 34.9 percent included principal deferrals; and 10.2 percent included principal reductions.

The OCC also evaluated modification performance. From the beginning of 2008 through the second quarter of 2011, servicers modified more than 2.2 million loans. About half â€" 50.8 â€" are current or have been paid off.

Of the remainder, 17.8 percent are seriously delinquent, and 8.8 percent are 30-59 days delinquent.

The OCC's report included 32.4 million loans, making up 62 percent of all mortgages in the U.S.