Foreclosures increase for prime borrowers
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An alliance of mortgage servicers is reporting a jump in prime-loan foreclosures from January to February. From Inman News:
HOPE NOW put the number of foreclosure starts on prime loans during February at 157,000, a 25 percent increase from the month before. Foreclosure starts on subprime loans fell by 5 percent, to 86,000. The record 243,000 foreclosure starts recorded in February represented a 12 percent increase from the month before and a 36 percent increase from a year ago.
Not every home headed for foreclosure ends up there.
Nevertheless, completed foreclosure sales of homes purchased with prime loans jumped 86 percent in February, to 56,000. Foreclosure sales of homes bought with subprime mortgages fell 16 percent, to 32,000. The 87,000 foreclosure sales for the month represented a high point not seen since July, when 92,000 foreclosed homes were sold. Completed foreclosure sales as a percentage of starts rose to 46 percent, up dramatically from the recent low of 30 percent in December. The percentage was even higher for homes purchased with prime loans -- 54 percent, compared with 25 percent in December.
Although not unexpected, it’s dramatic nonetheless, and another sign that the housing market is still on the downward slope.
-- Lauren Beale
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