Lender Processing Services (LPS), a leading provider of integrated technology and services to the mortgage industry, announced its release of the April 2009 LPS Mortgage Monitor, an in-depth report of mortgage industry performance indicators as of March month end. The monthly report is based on data from the company’s market-leading repository of loan-level residential mortgage data and performance information, including more than 40 million active loans across the credit spectrum. This data is analyzed by LPS to produce nearly 20 charts and graphs reflecting both trend and point-in-time performance observations. Among the findings, LPS reports that the number of newly delinquent loans declined in March. However, the month-over-month March decline in delinquencies is about half as much, on a percentage basis, as the average in the same timeframe from 2002-2007 (5.8% vs. 14%). In fact, new delinquencies fell to their lowest level of the last 12 months. On the other end of the spectrum, foreclosure inventories experienced the highest monthly increase in nearly three years. An executive summary of the data is as follows: Total delinquencies fell in March to 7.88%, with a month-over-month decrease of 5.8%. The seasonal February to March decline in delinquencies in the five years from 2002 to  2007 averaged 14%. The percentage drop in newly delinquent loans for March 2009 is greater than it was in  2008, but less than observed in the three years prior to that. Foreclosure inventories continue to climb, with a March foreclosure rate of 2.52%, reflecting a month-over-month increase of 12.8% and a year-over-year increase of  87.8%. Since 2005, Jumbo Prime, Option ARMs and Conforming Prime loans continually  experience the highest rates of deterioration. The total percent of non-current loans (including delinquencies and foreclosures) is now at 10.39%, representing a month-over-month decrease in non-current loans of 1.9%, but a year-over-year increase of 54%. Current-to-30 roll rates were higher in March 2009 than they were at the same time in the preceding four years. The percentage of loans improving in status continued to increase in March, while loans deteriorating in status declined.  Seasonal effects can be noted here with similar declines  observed in 2005, 2006 and 2007. Foreclosure starts in March hit new all-time highs across every major product category: the largest 12-month increase was seen in Jumbo loans at 221%; Non-agency  conforming loans at 158%; and Agency Prime loans at 144%. Foreclosure starts on Portfolio loans spiked significantly in March; agency-owned  mortgages continued to rise, as well.  GMNA was the only investor category to remain stable for the month. Foreclosure sales dropped significantly in March, due in large part to the reinstatement of the FHFA moratorium on February 13th and continuing through the end of March. Refinance activity remains high, with a slight increase in available liquidity to borrowers who are 30-days delinquent. First payment defaults for Agency and Government product remain very stable. However, loans being held on balance sheets are experiencing a very high rate of early defaults. Approximately 87% of all 2008 production was either FNMA, FHLMC or GNMA. The weighted average credit score of newly originated loans has increased throughout 2008 for all investors, with the exception of portfolio loans (or bank-owned). The percentage of FHA loans with credit scores of less than 660 has dropped from almost 60% in January 2008 to 40% in December 2008.

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