Drop in Non-Current Loans About 7Xs Higher in Non-Judicial States: LPS

The percentage of loans not current, which includes 30-plus delinquencies and foreclosures, declined almost 7 times more in non-judicial states compared to judicial states, according to ""Lender Processing Services'"":http://www.lpsvcs.com/Pages/default.aspx (LPS) Mortgage Monitor report for April.

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Year-over-year, non-judicial states saw an 8.2 percent drop in non-current loans while in judicial states, the yearly decrease was only 1.2 percent.

When broken down by individual states, Florida had highest percentage of non-current loans, followed by Mississippi, New Jersey, Nevada, and Illinois.

States with the lowest percentage of non-current loans were Montana, Alaska, South Dakota, Wyoming, and North Dakota.

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Overall, the delinquency rate was 7.12 percent in April, a 0.4 percent monthly increase and a 10.6 decrease compared to the year before.

At 4.14 percent, the rate of loans in foreclosure inventory maintained historically high levels and remained unchanged from the previous month and year ago rate. In December 2005, the foreclosure inventory rate was about 0.5 percent.

Foreclosure starts numbered 181,584 in April, down 2.6 percent from the previous of March and a 3.1 percent drop from a year ago. On the other hand, FHA foreclosure starts saw a 73 percent increase. According to LPS, 2008 and 2009 vintage loans were the main driving factors behind the jump in FHA foreclosure starts.

""In 2008, when the loan origination market virtually dried up, the FHA stepped in to fill the void,"" explained Herb Blecher, SVP for LPS Applied Analytics. ""FHA originations tripled that year, and increased to five times historical averages in 2009. High volumes like that, even with low default rates, can produce larger numbers of foreclosure starts.""

Foreclosure sales, which totaled 66,773 in April, also decreased 2.6 percent from the previous month of March. In non-judicial states, foreclosure sales dropped 2 percent, and in judicial states, sales dropped slightly by 0.01 percent month-over-month.

The rate of seriously delinquent loans was 7.37 percent, down 1 percent from March and 6.3 percent a year ago.

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