Consumers did a better job of staying current on their primary, or first-lien, mortgages by the end of the fourth quarter of 2012, with 89.4 percent making payments on time compared to 88.6 percent the previous quarter.
That’s also slightly better than the 88.0 percent quality rate for first-lien mortgages one year ago, according to the newest update by the Office of the Comptroller of the Currency (OCC).
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 OCC report covers 29 million home loans totaling $4.9 trillion in outstanding balances, about 57 percent of all first-lien mortgages in the United States.
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, the OCC also said.
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.
Here are other findings from the OCC’s report:
- On average, modifications started in the fourth quarter of 2012 reduced borrowers’ monthly principal and interest payments by $389, or 25.9 percent. Modifications made under the government’s Home Affordable Modification Program (HAMP) reduced payments by an average of $558, or 35.4 percent.
- Modifications that reduced payments by 10 percent or more performed better than those that reduced payments by less. Fifty-five percent of modifications made since the beginning of 2008 that reduced payments by 10 percent or more were current or paid off at the end of the fourth quarter of 2012, compared with 36.5 percent of modifications made during that time that reduced payments by less than 10 percent.
- Servicers have modified 2,878,228 mortgages since the beginning of 2008 through the end of the third quarter of 2012. At the end of the fourth quarter of 2012, 47.7 percent of these modifications were current or paid off. Another 7.1 percent were 30 to 59 days delinquent, and 14.2 percent were seriously delinquent. There were 7.7 percent in the process of foreclosure, and 7.3 percent had completed the foreclosure process.