ANNAPOLIS, Md., Nov. 14, 2013 /PRNewswire/ -- The Mortgage Bankers Association (MBA) released a report on November 7th of 2013 stating that the delinquency rate, foreclosure inventory and rate at which homes were foreclosed on are at their lowest levels since the second quarter of 2008. As an added note, loans backed by the Veterans Administration (VA loans) have also seen their lowest delinquency rates since 1980, mainly due to 40% of VA loans coming into existence after 2007 and the home value crash.
USHUD.com COO, Tim Fry said, "This is great news for the housing market as a major step in the recovery of the housing market is a lowering of the delinquency and foreclosure rates. This is a significant indicator that good things are coming for future home owners as well as current."
Jay Brinkmann, MBA's Chief Economist and SVP of Research and Education said, "The degree to which the mortgage delinquency and foreclosure problem has changed over the last five years is perhaps best illustrated by the fact that last quarter New Jersey led the nation in the percentage increase in foreclosure actions filed, followed by Delaware, Maryland and Indiana. While Florida still leads the nation in the percentage of loans in foreclosure, that percentage is also lowering. In contrast, New York and New Jersey were the only two states that saw an increase in the percentages of loans in foreclosure.
In a series of quotes Mr. Brinkmann continued.
"States with judicial foreclosure systems still account for most of the loans in foreclosure. While the percentages of loans in foreclosure dropped in both judicial and nonjudicial states, the average rate for judicial states was 5.28 percent, more than triple the average rate of 1.66 percent for nonjudicial states."
"Many mortgage servicers are already reducing their staffs that handled delinquent loans and foreclosures and we expect that trend to continue as the numbers continue to fall."
"Also, while home prices have shown some considerable improvement, in only a small number of states they are back above their pre-2007 levels. This is noteworthy because roughly three-quarters of all seriously delinquent loans were originated in 2007 or earlier. So even if the economy continues to improve, those loans are less likely to weather any short term financial issues in the event of a divorce, illness or loss of a job because of the lack of borrower equity. This will keep the foreclosure rates above historical norms for a few more years."
"Finally, mortgage delinquencies are the result of local economic conditions, not the cause of them. Clearly local home price bubbles and the temporary injections from cash out refinancing and speculation temporarily boosted some areas and made the subsequent economic crash even worse, but we are now at a point where local economic growth and population movements will determine housing demand and mortgage performance. Those areas with the weaker climates for economic growth will see home value and delinquency problems that are beyond the abilities of the mortgage industry and housing regulators to impact in a meaningful way."
"After studying the yearly trends, barring any unseen future issues sending the economy deeper into recession, it seems safe to say that the real estate market is recovering and a real estate resurgence is coming," said USHUD.com COO, Tim Fry.
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