FHA FORECLOSURES FALL AND DELINQUENCIES RISE

“ FHA Foreclosures Fall and Delinquencies Rise”

What is really behind the numbers? The amount of foreclosures that have been started for the last couple of years have been minimal to say the least. Lenders/servicers, because of the robo-signing fiasco, have been reluctant to begin the process. Many of these lenders and these servicers have been sued and where fines millions of dollars.

Now, they are being pushed to get started on a huge backlog of properties that should be foreclosed. There are folks that have not paid their mortgages for years, yes years! These foreclosures need to be completed, so that these properties can get resold. The longer this process takes, the longer it take for real estate values begin to get stronger.

FHA Delinquencies Spike, but Foreclosure Fall

By: Kate Berry

Newly initiated foreclosures by the Federal Housing Administration jumped 247% in April from a year earlier, while the overall number of foreclosure starts fell 3.1% in the same period.

A report released Thursday by Lender Processing Services showed that FHA foreclosure starts jumped to 63,129 in April, from 18,154 a year ago. FHA foreclosure starts rose 73% in April from 36,311 in March, LPS found.

Herb Blecher, a senior vice president for LPS Applied Analytics, attributed the increase to a near-doubling of defaults on loans originated in 2008 and 2009. FHA loan volumes tripled in 2008, which, "even with low default rates, can produce larger numbers of foreclosure starts," Blecher said in a press release.

An FHA spokesman did not respond to requests for comment.

Still, the agency appears to be the exception in advancing foreclosures.

Housing experts had predicted that banks would jumpstart the foreclosure process after completing a $25 billion settlement with federal and state regulators. But instead, the settlement appears to have dramatically slowed the foreclosure process, as mortgage servicers work with troubled borrowers to modify loans or complete short sales.

Overall mortgage delinquencies rose slight to 7.1% in April, while 4.1% of all loans are in the foreclosure process, unchanged from a year earlier, the report found.

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