LPS’ November Mortgage Monitor: Foreclosure Inventory Falls as Starts Decline; Potential for Further HARP Refinance Activity Remains High

Delinquencies Up Sharply in Sandy-Impacted ZIPs

JACKSONVILLE, Fla. – Jan. 14, 2013 – The November Mortgage Monitor report released by Lender Processing Services (NYSE: LPS) shows the national foreclosure inventory dropped to 3.51 percent in November, representing an almost 10 percent decline from September 2012, when newly instituted National Mortgage Settlement requirements began to influence the pace of first-time foreclosure starts. As noted in last month’s Mortgage Monitor release, LPS expects foreclosure starts to rebound as mortgage servicers incorporate the new procedural requirements into their operations in the coming months.

LPS found mortgage origination activity strong. According to LPS Applied Analytics Senior Vice President Herb Blecher, borrowers are benefiting from today’s historically low interest rates. “Comparing interest rates on new versus paid-off loans, we see that interest rates on the former are 1.5 percentage points below the latter,” Blecher said. “With prepayment activity being as high as it is – 2 percent of total outstanding U.S. mortgage balances prepaid or refinanced in November alone – this equates to significant potential savings for borrowers. On average, this translates into new loan payments that are approximately $190 less per month than those of borrowers prior to paying off their loans.

“Additionally, after a decline in September related to the shortened business month, HARP-related origination activity is once again near its recorded highs, and we see significant potential for further growth on that front. There are currently approximately 2.6 million loans that fit generalized HARP eligibility requirements, with 50 percent having ‘prime quality’ credit scores of 720 or above.”

The November data also showed that the impact of Hurricane Sandy continued in ZIP codes hit hardest by the storm. While national delinquencies are moving in line with seasonal trends – that is, tending to rise slightly through the remainder of the calendar year – mortgage delinquencies increased sharply in those areas affected by Sandy. Whereas the national delinquency rate has increased 3.7 percent since August of this year, delinquencies in Sandy-impacted ZIPs have risen at more than threefold that pace – climbing 15.4 percent in Conn., 15.2 percent in N.J. and 14.8 percent in N.Y.

As reported in LPS’ First Look release, other key results from LPS’ latest Mortgage Monitor report include:

Total U.S. loan delinquency rate: 7.12%
Month-over-month change in delinquency rate: 1.2%
Total U.S. foreclosure pre-sale inventory rate: 3.51%
Month-over-month change in foreclosure pre-sale inventory rate: -2.84 %
States with highest percentage of non-current* loans: FL, NJ, MS, NV, NY
States with the lowest percentage of non-current* loans: MT, WY, SD, AK, ND

*Non-current totals combine foreclosures and delinquencies as a percent of active loans in that state.   Totals are extrapolated based on LPS Applied Analytics’ loan-level database of mortgage assets.

About the Mortgage Monitor
LPS manages the nation’s leading repository of loan-level residential mortgage data and performance information on nearly 40 million loans across the spectrum of credit products. The company’s research experts carefully analyze this data to produce a summary supplemented by dozens of charts and graphs that reflect trend and point-in-time observations for LPS’ monthly Mortgage Monitor Report. To review the full report, visit

About Lender Processing Services
Lender Processing Services (NYSE: LPS) delivers comprehensive technology solutions and services, as well as powerful data and analytics, to the nation’s top mortgage lenders, servicers and investors.  As a proven and trusted partner with deep client relationships, LPS offers the only end-to-end suite of solutions that provides major U.S. banks and many federal government agencies the technology and data needed to support mortgage lending and servicing operations, meet unique regulatory and compliance requirements and mitigate risk.

These integrated solutions support origination, servicing, portfolio retention and default servicing. LPS’ servicing solutions include MSP, the industry’s leading loan-servicing platform, which is used to service approximately 50 percent of all U.S. mortgages by dollar volume. The company also provides proprietary data and analytics for the mortgage, real estate and capital markets industries.

LPS is headquartered in Jacksonville, Fla., and employs approximately 8,000 professionals. The company is ranked on the Fortune 1000 as the 877th largest American company in 2012. For more information, please visit

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