LPS' July Mortgage Monitor Report: Foreclosure Starts Increase; Late-Stage Delinquencies Lead Rise

/PRNewswire/ -- The July Mortgage Monitor report released by Lender Processing Services, Inc. (NYSE:LPS) shows that foreclosure starts are on the rise, with seriously delinquent loans - those six or more months delinquent - dominating new foreclosure actions.

The increase in foreclosure starts is consistent with the Department of Treasury's latest report that approximately half of all Home Affordable Modification Program (HAMP) trial modifications resulted in cancellation, though 45.4 percent of those have resulted in alternative (non-HAMP) modifications.

Delinquent and foreclosure inventories continue to stabilize but have yet to show annual declines. Continuing the trend from June, agency prime loans have seen the greatest month-over-month increase in foreclosure inventory and the second highest percentage increase since January 2009. Only non-agency jumbo prime loans have experienced a greater increase during the same period, but the month-over-month results indicate that this inventory has begun to decline.

The report also shows that approximately 895,000 loans that were current at the beginning of January are at least 60 days delinquent or in foreclosure as of the end of July - a month-over-month increase of 120,000 loans. Cure rates remain steady overall, but seriously delinquent cures have declined significantly, by approximately 25 percent, which is consistent with the decline in permanent modifications established during the month of July.

Other key results from LPS' latest Mortgage Monitor report include:

           Total U.S. loan delinquency
           rate:                           9.33 percent
           Total U.S. foreclosure
           inventory rate:                 3.75 percent
           Total U.S. non-current* loan
           rate:                           13.08 percent
           States with most non-current*    Florida, Nevada, Mississippi,
           loans:                           Georgia, Arizona
           States with the fewest non-      North Dakota, South Dakota,
           current* loans:                  Alaska, Wyoming, Montana

  *Non-current totals combine foreclosures and delinquencies as a
   percent of active loans in that state.
  Note: Totals based on LPS Applied Analytics' loan-level database of
   mortgage assets.

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Lending Industry Still Fighting Mortgage Modification as Foreclosure Crisis Continues

/PRNewswire/ -- As the House debates the Wall Street Reform and Consumer Protection Act of 2009 this week, the lending industry continues to fight a mortgage modification provision that would allow bankruptcy judges to adjust the terms of mortgages to help struggling families as part of a broader effort to stem the worsening foreclosure crisis.

Lending industry opponents of the measure, some of the biggest recipients of federal bailout money, have spent lavishly on lobbying and campaign contributions in 2009. An analysis by Common Cause and Public Campaign shows that the coalition of banks opposed to the mortgage modification provision - including Citigroup, Bank of America, Wells Fargo and JPMorgan Chase & Co -- have spent more than $80 million on lobbying and more than $6 million on campaign contributions this year, according to data from the Center for Responsive Politics.

"These Wall Street banks were rescued by the taxpayers after they almost collapsed under their own bad investments," said Common Cause President Bob Edgar. "They took that money and are spending millions lobbying and making campaign contributions to stop proposals that would help those same taxpayers keep their homes."

"From regulatory reform to health care, campaign cash from Wall Street interests is permeating every corner of debate in Washington, D.C.," said Nick Nyhart, president and CEO of Public Campaign. "Congress must create a political system that works for all of us, not just those with money to spare. It's time to pass the Fair Elections Now Act."

The House is currently debating the Wall Street Reform and Consumer Protection Act of 2009 (HR 4173), the most significant overhaul of the financial industry since the New Deal. It may take up the bankruptcy amendment offered by Judiciary Committee Chairman John Conyers Jr. (D-MI) and Rep. Zoe Lofgren (D-CA) as soon as today. The House passed identical language in March, but the effort ran aground in the Senate.

Some House members want the Senate to reconsider the proposal, as most major lenders have not responded to the voluntary initiatives adopted in place of the bankruptcy provision. The Treasury Department estimates that only one-in-five eligible households have received government assistance through these voluntary programs.

Common Cause and Public Campaign continue to work to pass the Fair Elections Now Act (H.R. 1826 / S.752) as the comprehensive solution to the pay-to-play culture in Washington, D.C. exposed by the debate over regulatory reform. The legislation, sponsored by Sen. Dick Durbin (D-Ill.) and Rep. John Larson (D-Conn.) would create a citizen-funded election system for Congress in which candidates could run for office on a blend of small donations and public funds.

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