Foreclosure Crisis May Be Turning Around

Washington, DC, Feb. 22, 2010--The foreclosure crisis is showing signs of slowing, the Mortgage Bankers Association said.

"We are likely seeing the beginning of the end of the unprecedented wave of mortgage delinquencies and foreclosures that started with the subprime defaults in early 2007," said Jay Brinkmann, chief economist of the Mortgage Bankers Association, in a press release.

The drop in the 30-day delinquency rate "is a concrete sign that the end may be in sight."

The delinquency rate for mortgages on one- to four-unit residential properties was a seasonally adjusted 9.47% of all mortgages outstanding in the fourth quarter, down from 9.64% in the third quarter and up from 7.88% in the fourth quarter of 2008, according to the MBA's quarterly delinquency survey.

Delinquencies include mortgages that are at least one payment or more past due but not yet in foreclosure.

Also, 1.2% of outstanding mortgages entered the foreclosure process in the fourth quarter, down from 1.42% in the third quarter and up from 1.08% in the fourth quarter of 2008.

The percentages of loans 90 days or more past due and loans in foreclosure process set record highs in the fourth quarter, according to the report.

But the good news is there are fewer problem loans actually entering delinquency, which could be due to fewer layoffs, Brinkmann said.