CoreLogic Home Price Index Shows Decline for Second Straight Month

Home prices in the United States have declined for two months in a row, according to CoreLogic's market index, after rising for the first seven months of the year. The latest CoreLogic Home Price Index (HPI) shows that national home prices, including distressed sales, declined 2.79 percent in September 2010 when compared to September 2009. That follows a drop of 1.08 percent in August 2010 from a year earlier. All but seven states saw a decline in residential property values during the month of September.

Analysts See 7% Drop in Home Prices over Next Year

Despite a bounce in home prices during the first half of 2010, Fiserv Inc. says it expects property values nationally to fall another 7.1 percent over the next 12 months before beginning to stabilize at the end of 2011. The company sees double-dip territory ahead for many major markets, particularly those that saw the strongest appreciation during the spring and summer months of this year. The analysts at Standard & Poor's have released a similar forecast for the path of home prices. They anticipate an additional 7 percent to 10 percent drop through 2011.

FHA's Annual Single-Family Business Down 10% from Last Year

The Federal Housing Administration (FHA) insured 1.74 million single-family mortgages during fiscal year 2010, which for the agency ended in September. The collective value of the loans endorsed was $318.8 billion. FHA's loan volume for the year was down 10.3 percent from 2009, and came in below the 1.87 million mortgages it had previously projected would be endorsed in the 2010 fiscal year. The agency's serious delinquency rate stood at 8.4 percent at year-end. At the same time in 2009, the rate was 8.3 percent.

Fitch Says 7M Homes in the Shadows Will Take 40 Months to Clear

Fitch Ratings puts the industry's shadow inventory - meaning loans that are seriously delinquent, in foreclosure, or REO - at 7 million homes. The agency says based on recent liquidation trends, it will take more than 40 months to clear this distressed inventory. While the volume of newly delinquent mortgages has begun to improve, liquidation rates have been constrained by weak demand and initiatives to modify loans. On top of that, Fitch says the recent discovery of defects in the foreclosure process is prolonging the housing correction.

Study: Shadow Inventory to Keep REO Supply Elevated for Several Years

An estimated 4.1 million borrowers are in the process of foreclosure or are more than 90 days delinquent. Their homes make up what's been termed the shadow inventory -- a pent up supply of REOs that could drive down home prices and perhaps cause another wave of defaults. Guhan Venkatu, an economist at the Federal Reserve Bank of Cleveland, says even under the most benign projections, the stock of REO properties is likely to remain elevated for the next several years.

Foreclosures Sales, REO Inventories Increase Along West Coast: Report

ForeclosureRadar has released its September market report, and the company's data shows that both foreclosure sales and inventories of bank-owned properties are on the rise throughout the West Coast states of Arizona, California, Nevada, Oregon, and Washington. In Nevada, for example, foreclosure sales increased by nearly 40 percent from August to September, with the majority going back to the bank and swelling the REO supply even further.

Mortgage Rates Drop Yet Again to New Lows

The last time rates for 30-year mortgages were as low as they are now was in April 1951. Thirty-year fixed-rate mortgages have been under 5 percent for 23 weeks in a row, according to data gathered by Freddie Mac. This week, the GSE reports that the average 30-year rate fell again to break the survey's all-time low, hitting 4.19 percent. The 15-year fixed rate also averaged a record low of 3.62 percent.

Administration Officials Reject Idea of National Foreclosure Moratorium

Evidence of major servicers mishandling foreclosure paperwork has cast a cloud of doubt over the entire industry and servicing procedures across the board. Consumer advocacy groups and a number of state attorneys general have demanded a nationwide moratorium on foreclosures. But two senior White House officials have indicated that the Obama administration will not support an all-out foreclosure freeze. So far, five companies have announced voluntary foreclosure suspensions because of potential deficiencies in the legal paperwork.

Wells Fargo Offers Pick-a-Payment Customers a Reprieve

Wells Fargo & Co. announced this week that from December 18, 2010, through June 30, 2013, Wachovia Pick-a-Payment customers who are at-risk of default may be eligible to earn principal forgiveness by making on-time mortgage payments. The company says it has already written mortgage principals down by a total of nearly $3.4 billion for Pick-a-Payment customers. The bank will also contribute $24 million to eight states to help with customer outreach and alleviate the impact of foreclosure in local communities.