Unprecedented Number Of Defaults Are Clogging Foreclosure Pipeline

With the nation’s mortgage  delinquency  and foreclosure  rates at an all-time high, signs of a slowdown are more indicative of system backlog than real recovery. While default-prone second-homes are a particular plague for sun-belt states, rising delinquency rates on ARM and 30-year loans, along with older mortgages, are a troubling measure of the depth of this crisis. See the following article from Housing Predictor for more on this.

More than a record 7.5 million residential mortgages are delinquent or in foreclosure, and one million other properties are either banked owned or are waiting to be resold, according to Lender Processing Services, Inc. the nation’s largest provider of mortgage data.

The February report shows historic numbers, but also indicates that the pace of deterioration has slowed. The foreclosure pipeline is clogged as a result of record volume with some foreclosures taking more than 30-months to complete. The majority of the nation’s 50 largest banks subscribe to Lender Processing Services.

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