Countrywide’s operational results for September 2007 are out today, and show that the nation’s largest lender continues to ratchet operations downward. Mortgage loan fundings for the month of September 2007 totaled $21 billion, a 44 percent decline from September 2006, while foreclosures and delinquencies continued to rise. From the press release:

“September’s production volume is reflective of current market conditions and more restrictive underwriting,” said David Sambol, President and Chief Operating Officer. “For the third quarter of 2007, total mortgage loan production volume declined 27 percent from the second quarter of 2007 and 19 percent from the third quarter last year. Countrywide’s mortgage loan pipeline and average daily applications declined 39 percent and 45 percent, respectively, from June 2007 to $42 billion and $1.7 billion for September 2007, illustrating the significant drop in overall activity throughout the industry. “The delinquency rate as a percentage of loans serviced continued to increase in September. However, we estimate that approximately 40 basis points of the 82 basis point month-over-month increase was attributable to four fewer business days in September as opposed to August,” Sambol explained. “The Company is continuing to take the necessary steps to assist borrowers with foreclosure avoidance and investors with loss mitigation.”

Unlike some more skeptical observers, I don’t doubt that Countrywide is doing whatever it can from a servicing perspective to help troubled borrowers — but I just don’t know how much can be accomplished in loss mitigation when property values are declining, product availability is constricted, and investors have yet to really catch up with the idea of more uniform loan modification standards. As a result, delinquencies and foreclosures continue to pile up: according to the company’s data sheet for September, the number of delinquent borrowers as a percentage of UPB increased nearly 20 percent during the month as compared to August, hitting 5.85 percent of the overall portfolio. Foreclosures increased as well, up 6 percent from August to 1.27 percent of UPB. Obviously, the numbers are much higher if you look just at the company’s subprime portfolio. It’s also interesting to note here that in spite of a literal freefall in subprime originations during September — remember, I’d written earlier that Countrywide didn’t really stop funding subprime until last month — the company’s servicing portfolio continues to grow, reaching $1.46 trillion at September 30, 2007. For more information, visit http://www.countrywide.com.