Foreclosure Starts Drop
According to the Mortgage Bankers Association’s (MBA) National Delinquency Survey, foreclosure starts decreased by the largest amount ever since the survey began, is are now at half the peak level seen in 2009.
The percentage of loans in which foreclosure actions were started fell to 0.70 percent during the fourth quarter of 2012; this was the lowest level since the second quarter of 2007. Fourth quarter foreclosure starts were down 20 basis points from the third quarter, and were down 29 basis points from one year earlier.
This decline in the foreclosure starts rate marked the largest quarter-to-quarter drop ever recorded for the MBA’s survey. Forty-Four states saw the foreclosure starts rate fall or remain unchanged in the fourth quarter as compared to the previous quarter, and only three had a foreclosure starts rate at or above the reading from the fourth quarter of 2011.
In terms of foreclosures started during the fourth quarter, Florida experienced the highest start rate among the states at 1.34 percent, followed by Nevada at 1.18% percent. New Jersey has posted some of the highest overall foreclosure rates in the nation, but the foreclosure starts rate for New Jersey declined more than 1.2 percentage points between the third and fourth quarters. This was attributed to the diminishing effects of previous legislative efforts imposed to delay the foreclosure process.
Additionally, mortgage delinquency rates also fell during the fourth quarter of last year. Delinquency rates dropped 7.09 percent falling to the lowest level in more than four years. All three delinquency segments (30, 60, 90+ days) registered lower delinquency rates than the third quarter, these on a seasonally adjusted basis. Of the three delinquency segments, mortgage loans just 30 days overdue saw the greatest decline with a 21 basis point fall to 3.04 percent. As of the end of the fourth quarter of 2012 the total foreclosure inventory rate is 3.74 percent; the lowest reading since the end of 2008.