Amherst: Non-performing loans shrink $10 billion in November

Non-performing loans shrunk from $285.6 billion to $275.5 billion, contracting $10.1 billion in November. The non-performing loan bucket has fallen for 35 consecutive months, from a peak of $493.9 billion in Dec. 2009, according a new report from Amherst Securities Group

Fewer loans are moving into the non-performing loan bucket via default than are moving out by liquidation, modification or self-cure. 

Liquidation rate of non-performing loans was 28.8% per year this month, up from 22.8% per year from last year, which is a 26% year-over-year increase.

Also, the liquidation rate of the non-performing loan bucket increased to an average of 26.6% per year from 23.4% per year for the twelve months ending Nov. of this year to Nov. of last year. 

“This increases our certainty that, even with further increases in the liquidation rate, liquidation balances will continue to drop,” Amherst stated.

Rates from 90 plus day delinquent to foreclosure and from foreclosure to real-estate owned are in fairly tight range over last year, but have declined over the past few months.

Servicers exhibiting the lowest roll rates are Bank of America (BAC), Countrywide and JPMorgan Chase (JPM), indicating “this could be a sign that the National mortgage Settlement is taking hold.”

Click on the graph to see deliquesces to foreclosure roll dates.

Liquidations totaled $8 billion for November, an increase from $7.6 billion last year.

The combined amount of re-performing and non-performing loans decreased by $6.8 billion month-over-month to $494.2 billion.

Re-performing loans are currently $218.6 billion, up 1.54% from October. This is a reversal from last month’s drop due to a “correction of the aforementioned reporting error.” 

Re-defaults were estimated $8.4 billion in November, down from $11 billion last month.

3d rendering of a row of luxury townhouses along a street

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