Mortgage delinquencies take a sharp turn up
After five straight months of improvement, mortgage delinquencies rose dramatically in June. The national delinquency rate is 6.7 percent, up nearly 10 percent from May and the highest level since February, according to a report from Lender Processing Services.
This data follow another read on the mortgage market showing that nearly half of the loans modified in 2009 under the Obama administration's housing rescue program defaulted again.
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The Home Affordable Modification Program has helped 865,100 homeowners avoid foreclosure, but more than 306,000 could not keep up with even the modified monthly payments, according to the Special Inspector General for the Troubled Asset Relief Program. The program does not force banks to write down mortgage principal.
Overall mortgage delinquencies are still down 6.5 percent from a year ago, according to Lender Processing Services. Some of the spike may be attributed to "a seasonal phenomenon," according to LPS analysts, but this particular spike is larger than usual. Delinquencies ticked up just 3.4 percent in June 2012. The rise also spanned products and regions.
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Despite receding from the high levels during the housing crash, 4.8 million loans are delinquent or in foreclosure, according to LPS.
The states with the highest percentage of noncurrent loans are Florida, Mississippi, New Jersey, New York and Maine.
On the brighter side, foreclosure inventories, the number of loans in some stage of foreclosure, continued its slide and were down nearly 4 percent in June from May.
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Servicers have been working through the process more quickly, as there is a veritable crowd of buyers waiting for these properties to hit the market. Inventories of new and existing homes for sale are near record lows.
—By CNBC's Diana Olick. Follow her on Twitter @Diana_Olick.