Missed payments on mortgages jump to 6.4 million in April

by JON PRIOR

Mortgages 30 or more days delinquent or in foreclosure totaled 6.38 million in April, a 2.3% increase from the previous month, according to Lender Processing Services (LPS: 28.61 +0.49%).

The LPS "first look" monthly mortgage performance report showed a sudden increase in troubled loans in April after an 11% monthly drop in March. However, delinquencies are still 16.3% below levels seen one year ago. Overall, 7.97% of all loans in the LPS database are 30 or more days delinquent.

Of the 6.38 million properties in 30-day delinquency or worse, 4.2 million are not in foreclosure. There are also 1.9 million loans 90 days or more delinquent but not in foreclosure.

These mortgages are the exact ones making up the shadow inventory of foreclosures that are keeping downward pressure on home prices and stalling out a recovery. According to another data provider, CoreLogic (CLGX: 18.33 +0.16%), the shadow inventory has declined slightly over the past year.

CoreLogic defines the shadow inventory as mortgages in at least 90-day delinquency and currently transitioning from foreclosure to REO. This supply of properties currently not on MLS systems but winding through the foreclosure process fell to 1.8 million in January 2011, down from 2 million the year before.

But this inventory will continue to see incoming loans for some time.

"In addition to the current shadow supply, there are nearly 2 million nondelinquent or current negative equity loans that are more than 50% upside down that will likely become shadow supply in the near future," CoreLogic said.

URL to original article: http://www.housingwire.com/2011/05/17/missed-payments-on-mortgages-jump-to-6-4-million-in-april

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