Report: Fewer People Falling Behind on Home Loans

[Purveyor]

New mortgage delinquencies fell at end of 2009 as foreclosure crisis begins to ebb

The number of borrowers falling behind on their mortgage payments dropped sharply at the end of last year, a sign the foreclosure crisis is beginning to ebb.

The Mortgage Bankers Association said Friday the percentage of borrowers who missed just one payment on their home loans fell to 3.63 percent in the October to December quarter, down from 3.79 percent in the third quarter. The decline was even more remarkable because delinquencies usually rise at that time of year because of heating bills and holiday spending.

However, more than 15 percent of homeowners with a mortgage had missed at least one payment or were in foreclosure, a new record for the 10th-straight quarter

http://abcnews.go.com/Business/wireStory?id=9887023

[ScreamingMeemie]

1. Fewer home loans equals fewer foreclosures.

Which can then be twisted into and end to the "crisis". Now we can move on to dealing with the overwhelming rise in homeless people.

[NightWatcher]

2. FHA Numbers Indicate Foreclosures Will Rise/ Another wave of foreclosures looms

http://www.dailyfinance.com/story/real-estate/fha-numbers-indicate-foreclosures-will-rise/19341135/
FHA Numbers Indicate Foreclosures Will Rise

The percentage of mortgages backed by the FHA that are in default has risen by a third over the last year. According to a report in The Washington Post, "About 9.1% of FHA borrowers had missed at least three payments as of December, up from 6.5% a year ago, the agency's figures show."

Many of the troubled mortgages were granted in 2007 and 2008. Mortgages that are now two to three years old apparently carry especially high risks of default because of the large number of loans made during those years to people with extremely low credit scores.

The report adds to the confusion about the direction that the housing market is heading in 2010. RealtyTrac recently reported that forecloses this year may hit 3 million, up from 2.8 million last year. When the company released December 2009 data on Jan. 13, James J. Saccacio, chief executive officer of RealtyTrac said, "In the long term, a massive supply of delinquent loans continues to loom over the housing market, and many of those delinquencies will end up in the foreclosure process in 2010 and beyond as lenders gradually work their way through the backlog."

Choppy Data

Government data showed that home starts fell 4% in December, but building permits rose. The choppy federal data, which can change direction month by month, have been a hard set of indicators to use to forecast the real estate market in terms of sales and home prices.

The housing market will continue to be plagued by unemployment and overleveraged consumers, and pressure will also be on home prices by owners who have underwater mortgages. Some of these mortgage holders may believe that there will never be any equity value in their homes and that they're better off turning their house keys over to the bank.

In addition, a wave of $47 billion in interest-only loans will reset to full payments this year, according to credit agency Fitch Ratings. A portion of these homebuyers won't be able to make their new, higher monthly payments.

The FHA news only adds to the probability that 2010 won't be any better for the housing market than 2009 was.
_____________________________________________________

Another wave of foreclosures looms
http://abcnews.go.com/Business/wave-foreclosures-looms/story?id=9121965

A second wave of foreclosures is poised to hit the market, potentially undermining housing recovery efforts as more homes add to the glut of inventory and drive down prices.

These homes largely represent loans that are delinquent but have not yet resulted in foreclosure sales.

About 7 million properties are destined to go into foreclosure, according to a September study by Amherst Securities Group, compared with 1.27 million properties in early 2005.

[Robb]

3. This strikes me as a tad cherry-picked

....and a 0.16% quarterly decrease isn't much to crow about, IMO. Although it looks like the article has since been re-written with some rounding to make it look better.

[ThomWV]

4. Sounds like the same situation as with unemployment numbers - they just fall out of the system

As more and more foreclosures take place there are less people who were in trouble who are being counted. After all, if you were ten payments behind and then got tossed out, then you are no payments behind and fall off the list.

To be more cynical about it, what it means is that they have cleared the market of many loans that should never been made in the first place.

[SoCalDem]

5. Lifeboat maximum=10.. let's say it's got 30 people on/in it

every few hours, a shark "removes" a person hanging onto the side of the boat.. sooner or later the occupancy will approach 10, and there will be fewer people in the water...falling ...:(

but without food/water/rescue/luck , the other 10 still in the boat WILL still perish too.

[RaleighNCDUer]

6. I expect that makes sense, as they stopped giving out the high-risk

loans and those most at risk have already succumbed. It doesn't necessarily mean there is any improvement in the economy overall.