Mortgage Delinquencies Down, Foreclosures Holding at Record Highs

Mortgage delinquencies are the lowest they’ve been in two years – a fact which has many real estate experts predicting a long-awaited recovery.
The Wall Street Journal reports that new delinquencies (that is, mortgages with payments 30 days overdue) have declined slightly and currently account for about 6.2 million households across the country. That’s good news in itself, so  long as the pattern holds, since it implies an eventual slowing of new foreclosures.
But the really encouraging factor is the consistent decline in severe delinquencies (90+ days overdue). April was the third consecutive month that saw fewer severe delinquencies – and they also appear to be decreasing at a faster rate. This decrease probably accounts for the record-high rate of foreclosures – severe delinquencies are obviously less likely to qualify for loan modifications and more likely to turn into full-blown foreclosures. While this sounds like semi-bad news, it does at least mean that banks are processing foreclosures more quickly, which means that they’ll hopefully change hands more quickly, which means the possibility of mild stability sometime in the next few years.