March 27 - The overall quality of first-lien mortgages serviced by large national and federal savings banks improved from the prior quarter and from the same period a year ago according to a report released by the Office of the Comptroller of the Currency.
The OCC Mortgage Metrics Report for the Fourth Quarter of 2012 showed 89.4 percent of mortgages were current and performing at the end of the quarter, compared with 88.6 percent the prior quarter and 88 percent a year earlier. The percentage of mortgages 30 to 59 days past due was 2.9 percent, a decline of 8.2 percent from the previous quarter and 6.1 percent from a year ago. Seriously delinquent mortgages — 60 or more days past due or held by bankrupt borrowers whose payments are 30 days or more past due — remained at 4.4 percent for the third consecutive quarter, down 11.6 percent from a year earlier.
The number of loans in the process of foreclosure at the end of 2012 fell below one million for the first time since the end of June 2009. In the fourth quarter of 2012, servicers initiated 156,773 new foreclosures — the lowest number of new foreclosures since the OCC began reporting mortgage performance in the first quarter of 2008. The number of completed foreclosures fell to 105,875, a 7.7 percent decrease from the previous quarter and an 8.9 percent decrease from a year earlier.
Several factors contribute to the year-over-year improvement, including strengthening economic conditions, the ongoing effects of both home retention efforts and home forfeiture actions and servicing transfers to institutions outside the federal banking system.
Servicers continued to emphasize alternatives to foreclosure during the quarter, implementing 367,169 home retention actions compared with 169,064 home forfeiture actions. The number of home retention actions implemented by servicers decreased by 4.1 percent from the previous quarter and decreased 20.2 percent from the prior year.
Other key findings included:
The report covers 29 million first-lien mortgages totaling $4.9 trillion in outstanding balances, about 57 percent of all first-lien mortgages in the United States. The complete report can be downloaded from the OCC website, www.occ.gov.