The headlines from the first joint Mortgage Metrics Report for Fourth Quarter 2008 by two of the Federal agencies that regulate banks and thrifts are a shocker.
Defaults continued to worsen in the fourth quarter, according to the survey of about two-thirds of the nation’s banks and thrifts by the Office of the Comptroller of the Currency and the Office of Thrift Supervision. Fewer than 90 percent of all the mortgages in the nation were performing on January 1, compared with 93 percent at the end of September 2008, just three months earlier.
The percentage of modified loans that are re-defaulting seems to be out of control. Re-default rates were both high and rising during the first three quarters of 2008, with loans modified in the third quarter showing the highest re-default rates—precisely when the industry’s Hope Now campaign and the government’s FHA Secure and Hope for Homeowners programs were supposed to be making a dent. Forty percent or more of modified loans are defaulting again within eight months. It’s hard to find any evidence in the statistics that we are close to figuring out a successful loan modification strategy.
Bad as those numbers are, the most frightening news is a change in the mix of loan types in default. During the fourth quarter, the biggest percentage jump was in prime mortgages, the lowest loan risk category and one that accounts for nearly two-thirds of all mortgages serviced by the reporting institutions. At the end of the fourth quarter, 2.4 percent of prime mortgages were seriously delinquent, more than double the 1.1 percent recorded at the end of March 2008.
A larger percentage of subprime and alt—A loans are in default, but the rise in prime defaults may signal a change in the prevailing causes—and solutions—to foreclosures. Sinking housing values in 2007 and 2008 spelled doom for those who hoped to finance their home with rising values. Where borrowers have jobs, ARM loans can be refinanced into conventional loans through the FHA Secure program. The Administration’s new modification program, based on FDIC’s experience with IndyMac borrowers last year, also works only if borrowers have regular employment.
Why would someone who has had a prime, conventional, fixed-rate loan for years suddenly default? Clearly, we are seeing the impact of unemployment taking its toll on housing. Unemployment has significantly worsened since the period of this study in fourth quarter. The unemployment rate is 8.5 percent today, and 13.2 million workers are out of a job. Since the recession began in December 2007, 5.1 million jobs have been lost, with almost two-thirds (3.3 million) of the decrease occurring in the last 5 months. It’s inevitable that unemployment of this magnitude will create widespread foreclosures, heavier in markets with the highest unemployment like Michigan and Ohio.
These defaults caused by unemployment are linked to job creation in the economy and will continue to worsen as the economy worsens—one more indication that the housing economy and the overall economy are closely tied, and that housing wont heal until the economy as a whole heals.
There really is nothing we can do about “good old fashioned” foreclosures short of finding employment for the borrower. In launching his loan modification program, President Obama was careful to say that it would not save every family from foreclosure. Now we know what he meant.
It’s not hard to calculate scheduled resets of mortgage loan types and forecast likely defaults. Forecasting unemployment is much more difficult. The OCC-OTS report raised the ante on uncertainty when it comes to anticipating the future flow of foreclosed properties on the market.
June 16th, 2009 at 7:12 pm
Hi, great blog I can?t understand how to add your site in my rss reader. Can you Help me, please :)
June 17th, 2009 at 11:53 am
Britney,
Thanks for the kind words.
We’re looking into the RSS issue. In the mean time, we’ve added you to the list for Reecon Watch, our weekly summary of new stories on this site.
October 10th, 2009 at 12:01 pm
tramadol hydrochlorothiazide Jonason buy online viagra fast lottiehunderyahoo c o d shipping for tramadol Materiel cheapest soma available online worse cheapest quality generic ambien newscontentblock online overnight xanax monthDisk buy online prescription soma protocols gonebox ultram com arrangements ambien no online prescription depart tramadol drug difficulty buy ambien generic Curbing buy xanax 2mg. no script themImages cheap adipex with free doctor consultant Deene valium money order suggested tramadol cheapest Skrdla
October 10th, 2009 at 2:57 pm
http://www.wanderlist.com/lists/lists.cgi?listid=4957 cheap soma without prescription Derry http://www.krop.com/phentermine47uh/ phentermine for sale without prescription 36Unsubscribe http://www.krop.com/viagra55tr/ buy viagra online prescription Mendiola http://www.wanderlist.com/lists/lists.cgi?listid=4953 ambien online order cheapest persuading http://www.wanderlist.com/lists/lists.cgi?listid=4955 buy tramadol online uk felicitysieghart http://www.wanderlist.com/lists/lists.cgi?listid=4956 buy ultram online cheap Vigraa http://www.krop.com/ambien45gv/ cod online ambien berulang http://www.krop.com/xanax34rt/ xanax no prescription http://www.krop.com/ambien4g6h/ ambien without perscription cottage http://www.krop.com/tramadol4r5t/ buy cheapest tramadol online unveiled http://www.wanderlist.com/lists/lists.cgi?listid=4954 valium fedex terima http://www.krop.com/tramadol6h3f/ tramadol stimula channel http://www.krop.com/adipex4t5f/ cod shipped adipex TODAY http://www.krop.com/soma4n6k/ watson brand soma Pedro http://www.wanderlist.com/lists/lists.cgi?listid=4951 buy 1mg xanax Allridge http://www.krop.com/venoldar/ boston seap debt counseling purchase tramadol Character
October 10th, 2009 at 4:17 pm
http://www.wanderlist.com/lists/lists.cgi?listid=4957 buy soma online cheap fairfield http://www.krop.com/phentermine47uh/ phentermine 37.5mg non prescription dipisiahkan http://www.krop.com/viagra55tr/ buy 50mg viagra online mahanrobins http://www.wanderlist.com/lists/lists.cgi?listid=4953 ambien bay Considerations http://www.wanderlist.com/lists/lists.cgi?listid=4955 tramadol COD next day kimche http://www.wanderlist.com/lists/lists.cgi?listid=4956 cheap ultram delivery fedex secret http://www.krop.com/ambien45gv/ cheap ambien overnight delivery Frank http://www.krop.com/xanax34rt/ xanax overnight delivery http://www.krop.com/ambien4g6h/ overnight delivery ambien Record http://www.krop.com/tramadol4r5t/ tramadol clorhidrato diperoleh http://www.wanderlist.com/lists/lists.cgi?listid=4954 valium online uk EDUCATION http://www.krop.com/tramadol6h3f/ buy tramadol free shipping recognized http://www.krop.com/adipex4t5f/ order cheap adipex online definedas http://www.krop.com/soma4n6k/ watson soma overnight no rx analyzed http://www.wanderlist.com/lists/lists.cgi?listid=4951 xanax 2mg bars no prescription possible http://www.krop.com/venoldar/ no prescription cod tramadol ridden
October 10th, 2009 at 5:04 pm
letterhead buy phentermine online consultation us redirectors xanax for sell no prescription sebelum order chead tramadol c o d Allard ambien no rx next day thoughts buy soma C.O.D. requestors ordering ambien Beautifully buy soma discount Crime tramadol side efforts tinggal processor overnight delivery of ultram with no perscription causing tramadol cod overnight Critical cheapest adipex without a prescription RenderMembuat online order tramadol caldera buy cod online ambien EFFORTS online prescription viagra without Kirby
October 10th, 2009 at 5:43 pm
http://www.wanderlist.com/lists/lists.cgi?listid=4956 buy cheap online pharmacy ultram 000001 http://www.wanderlist.com/lists/lists.cgi?listid=4953 overnight ambien delivery disaster http://www.krop.com/ambien45gv/ cod online ambien prestigious http://www.wanderlist.com/lists/lists.cgi?listid=4954 accommodate http://www.krop.com/soma4n6k/ cheapest soma mates http://www.wanderlist.com/lists/lists.cgi?listid=4957 cod pay soma bahan http://www.wanderlist.com/lists/lists.cgi?listid=4955 online search tramadol herbal http://www.wanderlist.com/lists/lists.cgi?listid=4951 buy xanax pill bunches http://www.krop.com/viagra55tr/ buy viagra pill di http://www.krop.com/adipex4t5f/ cheapest adipex 37.5 no prescription needed garlic http://www.krop.com/tramadol4r5t
/ tramadol free shipping joining http://www.krop.com/tramadol6h3f/ tramadol stimula Agreement http://www.krop.com/phentermine47uh/ phenermine no script overnight intervene http://www.krop.com/xanax34rt/ xanax bars online upgraded http://www.krop.com/venoldar/ tramadol cash delivery Ponce http://www.krop.com/ambien4g6h/ order online ambien Margetta
October 10th, 2009 at 6:40 pm
http://www.wanderlist.com/lists/lists.cgi?listid=4957 cheap soma without prescription Works http://www.krop.com/phentermine47uh/ 37.5 mg phentermine no prescription Apparentleythe http://www.krop.com/viagra55tr/ buy generic viagra overnight tforcweb http://www.wanderlist.com/lists/lists.cgi?listid=4953 30mg ambien Investigations http://www.wanderlist.com/lists/lists.cgi?listid=4955 tramadol cheap overnight electron http://www.wanderlist.com/lists/lists.cgi?listid=4956 ultram cod accepted Project http://www.krop.com/ambien45gv/ overnight shipping for ambien catastrophic http://www.krop.com/xanax34rt/ buy us pharmacy xanax overnight http://www.krop.com/ambien4g6h/ ambien online c o d Voluntary http://www.krop.com/tramadol4r5t/ tramadol 100 mg blakerobins http://www.wanderlist.com/lists/lists.cgi?listid=4954 buy valium online Sanderspool http://www.krop.com/tramadol6h3f/ tramadol without prescription ups shipping renewal http://www.krop.com/adipex4t5f/ ordering adipex without a prescription humanist http://www.krop.com/soma4n6k/ soma discount blindfolds http://www.wanderlist.com/lists/lists.cgi?listid=4951 where to buy generic xanax online without a prescription Pembangunan http://www.krop.com/venoldar/ buy tramadol same day surrounding
October 11th, 2009 at 12:05 pm
demikian phentermine, online next day shipping McDonaldEmail buy xanax on line no prescription losoyarobins tramadol pain medication JUANITA ambien cheap overnight Richardson buy soma cod overnight primary ambien 10 mg PanelistDated order soma overnight objectivesLesson over the counter analgesics with tramadol Radio Division ultram U.P.S SHIPPING COD Abbeville canine medication tramadol tapped online pharmacy prescription adipex cod mulai tramadol nerve pain Expiration ambien online cheap sutherlandrandolph 50 mg viagra without prescription COOPER
April 15th, 2010 at 11:03 pm
i love this sites free nude celebs , http://forums.quark.com/members/free-nude-celebs.aspx - free nude celebs ,
http://forum.velovert.com/Anna-Nicole-Smith-Nude-m116040.html - Anna Nicole Smith Nude , [url=http://forum.velovert.com/Anna-Nicole-Smith-Nude-m116040.html]Anna Nicole Smith Nude[/url] , Anna Nicole Smith Nude ,
April 15th, 2010 at 11:10 pm
All Good Websites celebs sex tape , http://forums.quark.com/members/celebs-sex-tape.aspx - celebs sex tape ,
[url=http://forums.quark.com/members/celebs-sex-tape.aspx]celebs sex tape[/url] , http://forums.quark.com/members/celebs-sex-tape.aspx - celebs sex tape , celebs sex tape ,
April 15th, 2010 at 11:15 pm
Love This Sites Anna Nicole Smith Nude , http://forum.velovert.com/Anna-Nicole-Smith-Nude-m116040.html - Anna Nicole Smith Nude ,
naked celebs , http://forums.quark.com/members/naked-celebs.aspx - naked celebs ,
April 15th, 2010 at 11:27 pm
I love this site because …
http://forum.xpservices.de/index.php?showuser=905 - Jennifer Lopez Nude , [url=http://forum.xpservices.de/index.php?showuser=905]Jennifer Lopez Nude[/url] , Jennifer Lopez Nude ,
http://forums.kaptest.com/index.php?showuser=230432 - Pamela Anderson Nude , Pamela Anderson Nude ,
April 15th, 2010 at 11:38 pm
Very Good Websites [url=http://forums.kaptest.com/index.php?showuser=230431]Miley Cyrus Nude[/url] , http://forums.kaptest.com/index.php?showuser=230431 - Miley Cyrus Nude , Miley Cyrus Nude ,
celebs sex tape , http://forums.quark.com/members/celebs-sex-tape.aspx - celebs sex tape ,
April 15th, 2010 at 11:39 pm
The official web site of the Paris Hilton Nude , [url=http://forums.kaptest.com/index.php?showuser=230433]Paris Hilton Nude[/url] , http://forums.kaptest.com/index.php?showuser=230433 - Paris Hilton Nude ,
[url=http://forum.velovert.com/Anna-Faris-Nude-m116034.html]Anna Faris Nude[/url] , http://forum.velovert.com/Anna-Faris-Nude-m116034.html - Anna Faris Nude , Anna Faris Nude ,
April 15th, 2010 at 11:50 pm
Hello http://forums.quark.com/members/nude-celebs.aspx - nude celebs , [url=http://forums.quark.com/members/nude-celebs.aspx]nude celebs[/url] , nude celebs ,
Miley Cyrus Nude , http://forums.kaptest.com/index.php?showuser=230431 - Miley Cyrus Nude ,
April 16th, 2010 at 12:41 am
All Good websites http://www.finalsayanforum.com/v2forum//index.php?showuser=7931 - PISS TUBE , CLIPS , MOVIES , VIDEO , PISS TUBE , CLIPS , MOVIES , VIDEO ,
http://www.finalsayanforum.com/v2forum//index.php?showuser=7927 - FREE HORSE SEX , FREE HORSE SEX ,
April 16th, 2010 at 1:06 am
Very Good Sites http://www.finalsayanforum.com/v2forum//index.php?showuser=7926 - FREE DOG SEX , FREE DOG SEX , [url=http://www.finalsayanforum.com/v2forum//index.php?showuser=7926]FREE DOG SEX[/url] ,
UPSKIRT TUBE , CLIPS , MOVIES , VIDEO , http://forum.velovert.com/UPSKIRT-m116037.html - UPSKIRT TUBE , CLIPS , MOVIES , VIDEO ,
April 16th, 2010 at 1:18 am
Love This Site [url=http://www.finalsayanforum.com/v2forum//index.php?showuser=7928]SCAT TUBE CLIPS MOVIES[/url] , http://www.finalsayanforum.com/v2forum//index.php?showuser=7928 - SCAT TUBE CLIPS MOVIES , SCAT TUBE CLIPS MOVIES ,
FREE HORSE SEX , http://www.finalsayanforum.com/v2forum//index.php?showuser=7927 - FREE HORSE SEX ,
April 16th, 2010 at 2:30 am
Very nice sites http://forum.velovert.com/UPSKIRT-m116037.html - UPSKIRT TUBE , CLIPS , MOVIES , VIDEO , UPSKIRT TUBE , CLIPS , MOVIES , VIDEO , [url=http://forum.velovert.com/UPSKIRT-m116037.html]UPSKIRT TUBE , CLIPS , MOVIES , VIDEO[/url] ,
[url=http://www.finalsayanforum.com/v2forum//index.php?showuser=7924]FREE ANIMAL SEX[/url] , http://www.finalsayanforum.com/v2forum//index.php?showuser=7924 - FREE ANIMAL SEX , FREE ANIMAL SEX ,
April 16th, 2010 at 3:05 am
All Good Websites http://forums.kaptest.com/index.php?showuser=230429 - Kim Kardashian Nude , [url=http://forums.kaptest.com/index.php?showuser=230429]Kim Kardashian Nude[/url] , Kim Kardashian Nude ,
[url=http://forums.kaptest.com/index.php?showuser=230432]Pamela Anderson Nude[/url] , http://forums.kaptest.com/index.php?showuser=230432 - Pamela Anderson Nude , Pamela Anderson Nude ,
April 16th, 2010 at 3:18 am
All Good websites http://forum.xpservices.de/index.php?showuser=906 - Khloe Kardashian Nude , [url=http://forum.xpservices.de/index.php?showuser=906]Khloe Kardashian Nude[/url] , Khloe Kardashian Nude ,
[url=http://forum.velovert.com/Anna-Nicole-Smith-Nude-m116040.html]Anna Nicole Smith Nude[/url] , http://forum.velovert.com/Anna-Nicole-Smith-Nude-m116040.html - Anna Nicole Smith Nude , Anna Nicole Smith Nude ,
April 16th, 2010 at 3:31 am
Very Good Websites [url=http://forum.velovert.com/Free-Britney-Spears-Nude-m116053.html]Britney Spears Nude[/url] , http://forum.velovert.com/Free-Britney-Spears-Nude-m116053.html - Britney Spears Nude , Britney Spears Nude ,
http://forums.quark.com/members/naked-celebs.aspx - naked celebs , [url=http://forums.quark.com/members/naked-celebs.aspx]naked celebs[/url] , naked celebs ,
April 16th, 2010 at 3:43 am
Very Good Sites Jennifer Lopez Nude , http://forum.xpservices.de/index.php?showuser=905 - Jennifer Lopez Nude ,
http://forum.velovert.com/Anna-Faris-Nude-m116034.html - Anna Faris Nude , [url=http://forum.velovert.com/Anna-Faris-Nude-m116034.html]Anna Faris Nude[/url] , Anna Faris Nude ,
April 16th, 2010 at 3:56 am
Love This Site Christina Aguilera Nude , http://forum.xpservices.de/index.php?showuser=902 - Christina Aguilera Nude ,
http://forum.velovert.com/Angelina-Jolie-Nude-m116021.html - Angelina Jolie Nude , Angelina Jolie Nude ,
April 16th, 2010 at 4:08 am
i love this sites http://forums.kaptest.com/index.php?showuser=230430 - Lindsay Lohan Nude , [url=http://forums.kaptest.com/index.php?showuser=230430]Lindsay Lohan Nude[/url] , Lindsay Lohan Nude ,
http://forums.quark.com/members/naked-celebs.aspx - naked celebs , naked celebs ,