Foreclosure

Lender Processing Services (LPS) is offering a sneak peak at its upcoming mortgage market report, scheduled for release September 24. The company's study will show that the national home loan delinquency rate has retreated, while the foreclosure rate is on the rise. LPS says the numbers are a sign that more delinquent loans are entering the foreclosure process, as servicers pick up the pace working through their default backlogs. According to LPS, the country's inventory of pre-sale foreclosures stood at 2,038,000 at the end of August.

As a one-stop shop for code violation reports and vacant property registrations, Code Violation Services, Inc. says it can typically verify the status of any violations within three to 10 days of order. During a three month period, the company analyzed 1,209 properties for one client. Forty-four were found to have code violations without fees yet assessed. The early detection saved the client $802,582 in penalties.

The number of homes taken back by lenders hit a new record high last month. RealtyTrac says lenders foreclosed on 95,364 U.S. properties in August, about 2 percent higher than the previous peak recorded in May. RealtyTrac's report shows overall foreclosure activity - including default notices, scheduled auctions, and REOs - jumped 4 percent between July and August. But the company says it's seeing a balance in the trend lines -- while bank repossessions are up, new default notices are down.

CoreLogic released its Home Price Index Wednesday, which showed that residential property values in the United States remained flat in July as transaction volumes continued to decline. It was the first time in five months that CoreLogic reported no year-over-year gains, and the company says a growing number of declining markets underscore weakness in the housing market without tax-credit support. Home prices actually fell in 36 states in July, the highest number since last November when national home prices were steadily declining.

California's notice of default filings, the first step in the state's foreclosure process, rose for the fourth successive month in August, jumping another 16.6 percent, according to the locally based tracking firm ForeclosureRadar. The company's latest data on the Golden State also show that fewer distressed homeowners are finding foreclosure relief, with cancellations down and foreclosure sales up. ForeclosureRadar has also expanded its coverage starting this month to include data on Arizona, Nevada, Oregon, and Washington.

The government has shifted its resources from civil to criminal mortgage-related cases in recent months. As a result, an industry index that tracks mortgage litigation lawsuits has dropped by more than half. Active cases totaled 75 in the second quarter, according to the report released this week. Activity tumbled 52 percent from the first quarter and was 40 percent lower than a year ago, as the U.S. Department of Justice executed its nationwide crackdown on mortgage fraud, dubbed Operation Stolen Dreams.

Fannie Mae recently issued a new servicing guide regarding pre-foreclosure mediation for mortgage loans in Florida. Last December, the Florida Supreme Court issued an administrative order requiring mediation sessions before a summary judgment or foreclosure sale can be held. In adherence to this mandate, Fannie Mae will now require that servicers assign delinquent mortgage loans secured by properties in Florida to an attorney from Fannie Mae's retained network for mediation prior to the initiation of foreclosure proceedings.

Special servicers of commercial real estate loans are feverishly pursing workouts and liquidations. Their efforts have helped to moderate increases in past dues, but delinquency rates, nonetheless, continue to rise. Two industry reports released last week served to drive this point home. Fitch Ratings says the delinquency rate on loans held in its rated commercial mortgage-backed securities (CMBS) hit 8.48 percent in August. Moody's reported a similar increase to 8.10 percent.

Housing conditions continued to show signs of stabilizing during the second quarter, following a downward trend that began to reverse itself in mid-2009, HUD says in a new report. The federal agency immediately follows that assessment, though, with ""the housing market's recovery remains fragile."" HUD's quarterly commentary on the state of housing in the U.S. sums up a dichotomy of positives and negatives in market indicators. For example, sales and prices of existing homes rose in Q2, but fell for new homes.

Nearly 31,000 borrowers with Fannie Mae and Freddie Mac loans forfeited their homes through a short sale or deed-in-lieu of foreclosure during the second quarter of this year. The figure represents a 27 percent increase over the previous three-month period. The GSEs also reported that their volume of permanent modifications under the administration's Home Affordable Modification Program (HAMP) increased 65 percent, but at the same time, foreclosure starts and foreclosure sales were also up by double digits.