by Calculated Risk on 3/21/2012 09:00:00 AM

LPS released their First Look report for February today. LPS reported that the percent of loans delinquent declined in February from January. However the percent of loans in the foreclosure process only declined slightly.

LPS reported the U.S. mortgage delinquency rate (loans 30 or more days past due, but not in foreclosure) declined to 7.57% from 7.97% in January. This is the lowest delinquency rate since 2008; however the percent of delinquent loans is still way above the normal rate of around 4.5% to 5%. The percent of delinquent loans peaked at 10.97%, so delinquencies have fallen a little more than halfway back to normal.

The following table shows the LPS numbers for February 2012, and also for last month (Jan 2012) and one year ago (Feb 2012).

LPS: Loans Delinquent and in Foreclosure
	Feb-12	Jan-12	Feb-11
Delinquent	7.57%	7.97%	8.80%
In Foreclosure	4.13%	4.15%	4.15%
Less than 90 days	2,059,000	2,226,000	2,495,000
More than 90 days	1,722,000	1,772,000	2,165,000
In foreclosure	2,065,000	2,084,000	2,196,000
Total	5,846,000	6,082,000	6,856,000

Note that the number of loans in the foreclosure process has only declined slightly year-over-year. This remains far above the "normal" level of around 0.5%.

by Calculated Risk on 3/21/2012 08:01:00 AM

From the MBA: Interest Rates Highest Since December, Applications Decrease in Latest MBA Weekly Survey

The Refinance Index decreased 9.3 percent from the previous week. The seasonally adjusted Purchase Index decreased 1.0 percent from one week earlier.
...
The refinance share of mortgage activity decreased to 73.4 percent of total applications, the lowest since July 2011, from 75.1 percent the previous week.
...
"With the rate increase last week, refinances are obviously slowing, and the refinance share at 73% is down to its lowest level since last July. With rate/term refinances falling as we go forward, HARP will be a bigger percentage of refinances but will be more concentrated in certain states," said Jay Brinkmann, MBA's Senior Vice President of Research and Education. Brinkmann continued, "Some of the largest institutions are reporting that the HARP share of their refinances remained at about 30% last week, but HARP volume is not equal across the country. The states that I started referring to years ago as the sand states that had the worst delinquencies we now should start calling the HARP states for mortgage refinances. We saw big state-level differences in refinance applications for February over January: Florida was up 49%, Arizona was up 61%, and Nevada was up 71%. Refinances in the rest of the country were generally flat or even down. For example, Texas had no change, Colorado was down 3%, Connecticut was up only 2%, and Virginia was up 1%. HARP clearly is a driving force in those states that saw the most defaults and the biggest drops in home equity."
...
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,500 or less) increased to 4.19 percent from 4.06 percent,with points increasing to 0.47 from 0.43 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans.

The purchase index was only off slightly - and this doesn't include the high percentage of cash buyers.

by Calculated Risk on 3/20/2012 09:23:00 PM

No surprise ... from the WSJ: Greek Parliament Approves Second Bailout

Greece's Parliament approved a new international bailout deal ... setting the stage for a round of harsh measures that the country's international creditors have set as a precondition for the funds.

The approval came in the early hours of Wednesday, with 213 lawmakers supporting the loan deal, and with 79 deputies voting against it. Eight didn't cast a vote.

Next up is an election in late April or early May.

Earlier:
• Housing Starts decline slightly in February
• Starts and Completions: Multi-family and Single Family

by Calculated Risk on 3/20/2012 05:55:00 PM

Update: Here are the slides. Link to lecture series (next is on Thursday)

This is part 1 of 4 of a lecture series on the Federal Reserve. The first lecture (about 1 hour) discusses monetary policy history, the tools and goals of the reserve - and he spent some time on the gold standard.

There should be slides available soon at the Federal Reserve. Joe Weisenthal at Business Insider has some of the slides (and Bernanke's comments on the gold standard).

by Calculated Risk on 3/20/2012 04:18:00 PM

There has been some discussion on when activity would increase for completed foreclosures. Last month, LPS reported that foreclosure sales increased 29% month-over-month in January.

LPS Applied Analytis was kind enough to provide me their estimates of foreclosure sales, by month, since January 2008.

Note: The sequence is 1) a loan goes delinquent, 2) if it doesn't cure, after several months, the foreclosure process begins (this is called the "foreclosure inventory"), 3) then the foreclosure is completed "foreclosure sale" and becomes REO (lender Real Estate Owned), and then 4) the REO is sold. Sometimes during this process, the loan will cure or a short sale approved, and not all loans in the foreclosure inventory reach "foreclosure sales".

Click on graph for larger image.

This graph shows the number of foreclosure sales per month since January 2008 according to LPS Applied Analytics.

There was a significant decline in foreclosure sales in late 2010 due to the foreclosure process issues.

There is plenty of month-to-month variability, but it appears foreclosure sales have picked up again (sales were up 29% compared to December 2011, and up 15% compared to January 2011).

This will be very useful data to track the expected increase in foreclosure activity.