Mortgage Monitor July 2014
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Transcript of Mortgage Monitor July 2014
Black Knight Financial Services TM SM ® Trademark(s) of Black Knight IP Holding Company, LLC, or an affiliate.©
2014 BKIS, LLC. All Rights Reserved.
Black Knight Mortgage
Monitor
Mortgage Market Performance Observations Data as of July, 2014 Month-end
2 Black Knight Financial Services
TM SM ® Trademark(s) of Black Knight IP Holding Company, LLC, or an affiliate.©
2014 BKIS, LLC. All Rights Reserved.
Focus Points
• Distressed inventory overview:
• New non-current loans
• 90+ inventory
• Home Retention activity
• State view
• Originations
• Purchase vs refinance
• Home Equity update
• Trends in delinquencies
• Originations and reset shock
3 Black Knight Financial Services
TM SM ® Trademark(s) of Black Knight IP Holding Company, LLC, or an affiliate.©
2014 BKIS, LLC. All Rights Reserved.
First Look July 2014 – still more than 1.1m properties in
90+ delinquency
Jul-14
Month-over-
month change
Year-over-
year change
5.64% -1.13% -12.07%
1.85% -1.65% -34.44%
90,700 2.72% -19.59%
1.05% 10.24% -41.01%
1.85% 7.09% -9.95%
2,849,000 -34,000 -344,000
1,136,000 -19,000 -211,000
935,000 -16,000 -471,000
3,785,000 -49,000 -814,000
12 Month
Trend
Total U.S. loan delinquency rate (loans 30 or more days past due, but
not in foreclosure):
Total U.S. foreclosure pre-sale inventory rate:
Total U.S. foreclosure starts:
Monthly Prepayment Rate (SMM):
Foreclosure Sales as % of 90+:
Number of properties that are 30 or more days past due, but not in
foreclosure:
Number of properties that are 90 or more days past due, but not in
foreclosure:
Number of properties in foreclosure pre-sale inventory:
Number of properties that are 30 or more days past due or in
foreclosure:
4 Black Knight Financial Services
TM SM ® Trademark(s) of Black Knight IP Holding Company, LLC, or an affiliate.©
2014 BKIS, LLC. All Rights Reserved.
Delinquencies and Foreclosures continue to decline
5 Black Knight Financial Services
TM SM ® Trademark(s) of Black Knight IP Holding Company, LLC, or an affiliate.©
2014 BKIS, LLC. All Rights Reserved.
New problem loans are back to 2005-2006 levels
6 Black Knight Financial Services
TM SM ® Trademark(s) of Black Knight IP Holding Company, LLC, or an affiliate.©
2014 BKIS, LLC. All Rights Reserved.
Rolls into a more delinquent status – have been
improving
7 Black Knight Financial Services
TM SM ® Trademark(s) of Black Knight IP Holding Company, LLC, or an affiliate.©
2014 BKIS, LLC. All Rights Reserved.
90 Day Defaults have increased 4 months in a row
July 2014:
53% of foreclosure starts are repeats
79% are 2008 or prior originations
74% of 90 day defaults are
2008 or prior originations
8 Black Knight Financial Services
TM SM ® Trademark(s) of Black Knight IP Holding Company, LLC, or an affiliate.©
2014 BKIS, LLC. All Rights Reserved.
80% of total 90+ delinquent inventory is from 2008 or
older vintages
9 Black Knight Financial Services
TM SM ® Trademark(s) of Black Knight IP Holding Company, LLC, or an affiliate.©
2014 BKIS, LLC. All Rights Reserved.
Home retention actions slowed down as distressed
inventory declined
10 Black Knight Financial Services
TM SM ® Trademark(s) of Black Knight IP Holding Company, LLC, or an affiliate.©
2014 BKIS, LLC. All Rights Reserved.
Still a lot of activity relative to the distressed inventory
11 Black Knight Financial Services
TM SM ® Trademark(s) of Black Knight IP Holding Company, LLC, or an affiliate.©
2014 BKIS, LLC. All Rights Reserved.
Home retention activity does not always correlate
with amount of distressed inventory
State
90+ and FC inventory
as of 1/31/2014
Home Retention Actions
as percentage of 90+ and
FC (first 6 months of 2014)
Top 20 for Home
Retention Activity?
FL 363,093 5.9% NO
NY 213,665 6.0% NO
CA 181,229 11.6% YES
NJ 168,389 5.2% NO
IL 128,200 7.7% NO
TX 123,831 10.3% YES
PA 95,942 8.4% NO
OH 88,979 8.2% NO
GA 83,526 10.0% YES
MD 81,767 8.9% NO
NC 65,017 10.2% YES
WA 57,272 7.3% NO
IN 51,151 9.3% YES
MA 49,057 8.3% NO
MI 47,077 10.1% YES
VA 44,895 10.4% YES
TN 42,806 8.4% NO
NV 38,426 6.0% NO
CT 37,472 8.8% NO
SC 36,879 9.4% YES
12 Black Knight Financial Services
TM SM ® Trademark(s) of Black Knight IP Holding Company, LLC, or an affiliate.©
2014 BKIS, LLC. All Rights Reserved.
Retention actions have not dropped in judicial
states
13 Black Knight Financial Services
TM SM ® Trademark(s) of Black Knight IP Holding Company, LLC, or an affiliate.©
2014 BKIS, LLC. All Rights Reserved.
…but CA is higher
14 Black Knight Financial Services
TM SM ® Trademark(s) of Black Knight IP Holding Company, LLC, or an affiliate.©
2014 BKIS, LLC. All Rights Reserved.
Originations dropped slightly in June
15 Black Knight Financial Services
TM SM ® Trademark(s) of Black Knight IP Holding Company, LLC, or an affiliate.©
2014 BKIS, LLC. All Rights Reserved.
Refinance share – 32%, Aug 2008 was 35%
16 Black Knight Financial Services
TM SM ® Trademark(s) of Black Knight IP Holding Company, LLC, or an affiliate.©
2014 BKIS, LLC. All Rights Reserved.
Share of jumbo loans just under 9% in 2014
17 Black Knight Financial Services
TM SM ® Trademark(s) of Black Knight IP Holding Company, LLC, or an affiliate.©
2014 BKIS, LLC. All Rights Reserved.
Interest rates on jumbo loans continue to be lower than
non-GSE loans
18 Black Knight Financial Services
TM SM ® Trademark(s) of Black Knight IP Holding Company, LLC, or an affiliate.©
2014 BKIS, LLC. All Rights Reserved.
Some loosening of LTV requirements since 2009
19 Black Knight Financial Services
TM SM ® Trademark(s) of Black Knight IP Holding Company, LLC, or an affiliate.©
2014 BKIS, LLC. All Rights Reserved.
Home Equity products delinquencies improving
20 Black Knight Financial Services
TM SM ® Trademark(s) of Black Knight IP Holding Company, LLC, or an affiliate.©
2014 BKIS, LLC. All Rights Reserved.
New Non-current loans at multi-year lows similar to
First Lien mortgage
21 Black Knight Financial Services
TM SM ® Trademark(s) of Black Knight IP Holding Company, LLC, or an affiliate.©
2014 BKIS, LLC. All Rights Reserved.
2014 HELOC Originations up 18% Y/Y.
NV, MI, RI, FL among those with largest increase
22 Black Knight Financial Services
TM SM ® Trademark(s) of Black Knight IP Holding Company, LLC, or an affiliate.©
2014 BKIS, LLC. All Rights Reserved.
HELOCs payment shock still a concern
23 Black Knight Financial Services
TM SM ® Trademark(s) of Black Knight IP Holding Company, LLC, or an affiliate.©
2014 BKIS, LLC. All Rights Reserved.
BKFS Mortgage Monitor Appendix
Data as of July, 2014 Month-end
24 Black Knight Financial Services
TM SM ® Trademark(s) of Black Knight IP Holding Company, LLC, or an affiliate.©
2014 BKIS, LLC. All Rights Reserved.
June2014 Data Summary
July Summary Statistics
Jul-14
Monthly
Change
YTD
Change
Yearly
Change
Delinquencies 5.64% -1.13% -12.76% -12.07%
Foreclosure 1.85% -1.65% -25.36% -34.44%
Foreclosure Starts 90,690 2.69% -13.43% -19.64%
Seriously Delinquent (90+) or
in Foreclosure 4.10% -1.64% -18.53% -25.86%
New Originations (data as of
Jun-14) 466K -3.6% 37.8% -40.0%
12 Month History
Jul-14 Jun-14 May-14 Apr-14 Mar-14 Feb-14 Jan-14 Dec-13 Nov-13 Oct-13 Sep-13 Aug-13 Jul-13
Delinquencies 5.64% 5.70% 5.62% 5.62% 5.52% 5.97% 6.27% 6.47% 6.45% 6.28% 6.46% 6.20% 6.41%
Foreclosure 1.85% 1.88% 1.91% 2.02% 2.13% 2.22% 2.35% 2.48% 2.50% 2.54% 2.63% 2.66% 2.82%
Foreclosure Starts 90,690 88,314 86,258 78,796 88,113 91,993 94,075 104,759 104,939 118,837 108,953 107,552 112,849
Seriously Delinquent (90+) or
in Foreclosure 4.10% 4.17% 4.22% 4.39% 4.52% 4.70% 4.92% 5.03% 5.05% 5.10% 5.26% 5.22% 5.53%
New Originations 466K 483K 445K 412K 338K 357K 452K 439K 493K 510K 649K 743K
6.41
%
6.2
0%
6.4
6%
6.2
8%
6.45
%
6.47
%
6.27
%
5.97
%
5.52
%
5.62
%
5.62
%
5.70
%
5.64
%
Total Delinquencies
743K
64
9K
510K
49
3K
439K
452K
357K
338K 41
2K
445K
483K
46
6K
New Originations
25 Black Knight Financial Services
TM SM ® Trademark(s) of Black Knight IP Holding Company, LLC, or an affiliate.©
2014 BKIS, LLC. All Rights Reserved.
Six of the top 10 states for total non-current are
judicial
State Del % FC % Non-
Curr %
Yr/Yr
Change
in NC%
State Del % FC % Non-
Curr %
Yr/Yr
Change
in NC%
State Del % FC % Non-
Curr %
Yr/Yr
Change
in NC%
National 5.6% 1.9% 7.5% -18.9% National 5.6% 1.9% 7.5% -18.9% National 5.6% 1.9% 7.5% -18.9%
MS 12.5% 1.7% 14.2% -5.6% GA 7.4% 1.0% 8.5% -15.5% KS * 5.5% 1.0% 6.6% -9.3%
NJ * 6.3% 6.1% 12.4% -16.7% SC * 6.5% 1.9% 8.4% -13.4% IA * 4.5% 1.5% 5.9% -15.4%
FL * 6.1% 4.8% 10.9% -31.8% IL * 5.6% 2.6% 8.2% -24.7% WA 4.0% 1.6% 5.6% -23.6%
LA * 9.1% 1.7% 10.9% -5.4% MA 6.8% 1.4% 8.1% -13.1% OR 3.6% 2.0% 5.6% -19.6%
NY * 6.2% 4.6% 10.8% -15.0% HI * 4.0% 4.1% 8.1% -21.6% UT 4.7% 0.8% 5.5% -16.2%
ME * 6.5% 3.8% 10.3% -14.2% NV 5.9% 2.2% 8.1% -32.5% VA 4.7% 0.6% 5.3% -12.7%
RI 7.8% 2.4% 10.2% -13.9% OK * 6.0% 2.1% 8.1% -10.8% NE * 4.4% 0.6% 5.0% -11.8%
AL 9.0% 1.0% 10.0% -5.0% KY * 5.9% 1.6% 7.4% -12.5% ID 3.6% 1.2% 4.8% -25.4%
IN * 7.4% 1.9% 9.3% -12.7% NC 6.4% 1.0% 7.3% -14.7% AZ 3.9% 0.6% 4.5% -19.4%
WV 8.0% 1.1% 9.1% -5.1% NM * 5.1% 2.3% 7.3% -11.2% CA 3.7% 0.7% 4.4% -28.6%
AR 7.7% 1.5% 9.1% -10.8% TX 6.4% 0.7% 7.1% -11.0% WY 3.8% 0.5% 4.3% -3.9%
PA * 6.8% 2.3% 9.1% -12.5% VT * 4.7% 2.4% 7.0% -17.3% MN 3.5% 0.6% 4.1% -16.2%
CT * 6.1% 3.0% 9.1% -19.5% MO 6.1% 0.8% 6.9% -11.2% AK 3.5% 0.5% 4.1% -8.3%
DE * 6.7% 2.2% 9.0% -14.8% WI * 5.4% 1.4% 6.8% -16.6% MT 3.1% 0.9% 3.9% -13.1%
MD * 6.6% 2.4% 8.9% -21.3% MI 5.8% 0.8% 6.6% -15.4% CO 3.2% 0.5% 3.8% -18.8%
TN 7.9% 0.9% 8.8% -9.6% NH 5.6% 1.1% 6.6% -11.6% SD * 2.9% 0.7% 3.6% -12.5%
OH * 6.7% 2.1% 8.7% -16.6% DC 4.5% 2.0% 6.6% -19.0% ND * 1.9% 0.6% 2.6% -16.2%
* - Indicates Judicial State
26 Black Knight Financial Services
TM SM ® Trademark(s) of Black Knight IP Holding Company, LLC, or an affiliate.©
2014 BKIS, LLC. All Rights Reserved.
Loan counts and
average days delinquent
Month
TOTAL
ACTIVE
COUNT 30 DAYS 60 DAYS 90+ DAYS FC
Total Non-
Current FC Starts
Average Days
Delinquent for
90+
Average Days
Delinquent for
FC
Ratio of
90+ to FC
1/31/2008 54,094,282 1,701,163 664,956 940,832 817,948 4,124,899 197,210 189 255 115.0%
1/31/2009 54,267,187 1,945,997 909,744 1,817,809 1,318,840 5,992,391 249,655 191 321 137.8%
1/31/2011 52,138,710 1,682,266 715,350 1,988,781 2,162,601 6,548,999 261,272 332 528 92.0%
1/31/2012 51,111,780 1,531,458 627,874 1,758,894 2,163,659 6,081,884 219,750 397 668 81.3%
1/31/2013 49,896,142 1,407,343 567,022 1,531,216 1,702,715 5,208,297 147,593 468 814 89.9%
2/28/2013 50,123,564 1,400,311 526,649 1,483,423 1,693,699 5,104,081 131,826 473 824 87.6%
3/31/2013 50,186,364 1,346,310 495,352 1,465,953 1,688,809 4,996,424 121,012 492 834 86.8%
4/30/2013 50,117,188 1,252,302 464,676 1,394,132 1,588,138 4,699,249 127,496 503 843 87.8%
5/31/2013 50,076,535 1,243,193 465,129 1,334,699 1,524,837 4,567,859 116,812 511 852 87.5%
6/30/2013 49,823,992 1,471,134 511,731 1,344,818 1,457,699 4,785,382 109,042 512 860 92.3%
7/31/2013 49,784,184 1,335,498 510,585 1,347,161 1,406,121 4,599,365 112,849 517 876 95.8%
8/31/2013 50,370,772 1,344,657 491,283 1,287,867 1,340,955 4,464,763 107,552 505 895 96.0%
9/30/2013 50,521,857 1,397,119 537,260 1,331,344 1,327,608 4,593,332 108,953 513 895 100.3%
10/31/2013 50,161,457 1,345,175 523,729 1,282,783 1,275,579 4,427,266 118,837 512 900 100.6%
11/30/2013 50,264,345 1,424,197 534,167 1,282,938 1,256,170 4,497,471 104,939 500 905 102.1%
12/31/2013 50,163,956 1,411,348 551,473 1,280,336 1,244,436 4,487,591 104,759 490 920 102.9%
1/31/2014 50,044,899 1,318,673 532,548 1,288,573 1,175,470 4,315,263 94,075 481 943 109.6%
2/28/2014 50,118,665 1,267,410 482,140 1,241,878 1,114,985 4,106,413 91,993 481 956 111.4%
3/31/2014 50,211,856 1,135,658 435,521 1,198,907 1,069,791 3,839,877 88,113 496 966 112.1%
4/30/2014 50,211,885 1,197,193 436,813 1,187,019 1,016,287 3,837,312 78,796 495 985 116.8%
5/31/2014 50,541,174 1,222,390 447,930 1,168,971 966,062 3,805,353 86,258 501 993 121.0%
6/30/2014 50,530,807 1,261,502 466,039 1,155,114 951,384 3,834,039 88,314 502 997 121.4%
7/31/2014 50,521,130 1,239,298 473,983 1,136,139 935,460 3,784,879 90,690 501 1,001 121.5%
27 Black Knight Financial Services
TM SM ® Trademark(s) of Black Knight IP Holding Company, LLC, or an affiliate.©
2014 BKIS, LLC. All Rights Reserved.
BKFS Mortgage Monitor
Disclosures: Product / Metric Definitions and
Market Sizing
28 Black Knight Financial Services
TM SM ® Trademark(s) of Black Knight IP Holding Company, LLC, or an affiliate.©
2014 BKIS, LLC. All Rights Reserved.
Disclosure Page: Product Definitions
*Conforming limits do not account for temporary or high-cost area increases.
29 Black Knight Financial Services
TM SM ® Trademark(s) of Black Knight IP Holding Company, LLC, or an affiliate.©
2014 BKIS, LLC. All Rights Reserved.
Disclosure Page: Metrics Definitions
• Total Active Count: All active loans as of month-end including loans in any state of delinquency or foreclosure. Post-sale loans and loans in REO are excluded from the total active count.
• Delinquency Statuses (30, 60, 90+, etc): All delinquency statuses are calculated using the MBA methodology based on the payment due date provided by the servicer. Loans in foreclosure are reported separately and are not included in the MBA days delinquent.
• 90 Day Defaults: Loans that were less than 90 days delinquent in the prior month and were 90 days delinquent, but not in foreclosure, in the current month.
• Foreclosure Inventory: The servicer has referred the loan to an attorney for foreclosure. Loans remain in foreclosure inventory from referral to sale.
• Foreclosure Starts – Any active loan that was not in foreclosure in the prior month that moves into foreclosure inventory in the current month.
• Non-Current: Loans in any stage of delinquency or foreclosure.
• Foreclosure Sale / New REO: Any loan that was in foreclosure in the prior month that moves into post-sale status or is flagged as a foreclosure liquidation.
• REO: The loan is in post-sale foreclosure status. Listing status is not a consideration, this includes all properties on and off the market.
• Deterioration Ratio: The ratio of the percentage of loans deteriorating in delinquency status vs. those improving.
30 Black Knight Financial Services
TM SM ® Trademark(s) of Black Knight IP Holding Company, LLC, or an affiliate.©
2014 BKIS, LLC. All Rights Reserved.
Disclosure Page: Extrapolation Methodology
Mortgage statistics are scaled to estimate the total market performance based on coverage within the McDash database.
The following table contains information on market coverage by product as of June 2012; extrapolations also include adjustments for vintage and as of date. Additional information is available upon request.