Improvements in Delinquencies Obscured by 7.39M Troubled Loans: LPS

""Mixed results"" has been the predominant theme among industry reports over the last couple of weeks. The latest study from ""Lender Processing Services"":http://www.lpsvcs.com (LPS) held true to form.

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The Florida-based company's ""Mortgage Monitor"":http://www.lpsvcs.com/NEWSROOM/INDUSTRYDATA/Pages/default.aspx report provides a snapshot of the nation's home loan market based on data as of March 2010 month-end.

LPS' analysis indicates ""modest improvements"" in the number of nonperforming loans returning to current status and fewer new delinquencies. But the research firm says these steps forward are still overshadowed by a large pool of 7.39 million non-current and REO loans.

According to LPS, the federal government's Home Affordable Modification Program (HAMP) is clearly making a dent in the industry’s delinquency numbers, as

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evidenced in the improved level of loan cure rates as trial modifications are converted to official loan restructurings.

In addition, the company says elevated levels of early-stage cures â€" meaning loans than are less than 60 days delinquent â€" indicate a higher rate of self-cures as homeowners bring payments current on their own.

LPS’ tally of 7.39 million nonperforming loans at the end of March is a clear improvement over the nearly 8.5 million loans the month before estimated to be in delinquency, foreclosure, or REO status. Overall, the number of non-current loans across the nation has declined over the past six months, but the still-elevated total represents hefty increases compared to a year ago.

LPS’ data show total delinquencies, excluding foreclosures, decreased 10.3 percent from February to March 2010, however, the total represents a year-over-year increase of 15.7 percent.

Similarly, March's foreclosure rate stands at 3.27 percent, representing a month-over-month decrease of 1.2 percent, but a year-over-year increase of 32.9 percent. The number of loans moving from seriously delinquent into foreclosure rose again in March, after hitting historic lows in February.

Several of the nation's largest states by population, including Florida, Nevada, New Jersey, Arizona, California, Illinois, Indiana, and Ohio showed foreclosure inventories at a higher percentage than the average national foreclosure rate of 3.27 percent.