LPS Mortgage Monitor - July 2012

Lender Processing Services 1

ON

E SO

UR

CE.

PO

WER

FUL

SOLU

TIO

NS.

ON

E SO

UR

CE.

PO

WER

FUL

SOLU

TIO

NS.

: : :

: : :

: : :

: : :

: : :

: : :

: : :

: : :

: : :

: : :

: : :

: : :

: : :

:

LPS Mortgage MonitorAugust 2012 Mortgage Performance Observations

Data as of July, 2012 Month-end

Lender Processing Services 2

July 2012 “First Look”McDash Online Release: August 16th

Lender Processing Services 3

DQs are down over 30% from peak;FCs still near all-time highs

Lender Processing Services 4

Delinquencies and Foreclosures by State

Average year over year change in non-current percent (includes loans 30+ Delinquent or in Foreclosure)

Judicial =-3.1% Non-judicial =-8.7%

Lender Processing Services 5

Non-judicial states have experienced greater improvement in non-current rates

Non-Judicial: Down 31% from peak

Judicial: Down 13% from peak

Few non-judicial states remain close to peak levels

Washington, NJ and Vermont are still at historic highs

Lender Processing Services 6

New problem loan rates remainslightly higher in judicial states

Lender Processing Services 7

Further house price declines could lead to more new problems

Lender Processing Services 8

Nationally, 18% of current loans remain underwater

Top 10

StateNegative Equity %

NV 54.7%

GA 42.8%

FL 33.1%

MI 29.8%

AZ 28.4%

IL 27.4%

ID 24.1%

CA 23.7%

MD 23.4%

WA 22.2%

Bottom 10

StateNegative Equity %

DC 3.3%

TX 3.2%

IN 2.9%

MT 2.8%

OK 2.6%

LA 2.5%

IA 2.4%

NE 1.3%

ND 1.0%

WY 0.4%

Lender Processing Services 9

Negative equity and new problem loan correlation is clear by geography

Lender Processing Services 10

First time foreclosure starts remain near multi-year lows

Lender Processing Services 11

While volumes are down, FC starts as a % of 90+ inventory are steady

Lender Processing Services 12

Judicial and non-judicial foreclosure starts continue to diverge

Lender Processing Services 13

Foreclosure inventory in judicial states is almost 3x non-judicial

Lender Processing Services 14

Foreclosure starts outnumber liquidations by 2:1

Lender Processing Services 15

Foreclosure sales in judicial states remained flat in July

Lender Processing Services 16

Pipeline ratios in judicial states increased slightly

Lender Processing Services 17

Pipeline issues in AR are resolving, NY and NJ are still extreme

Lender Processing Services 18

Prepayment rates increased as mortgage rates hit historic lows

Lender Processing Services 19

June originations at the highest levels since 2010

Lender Processing Services 20

Refi participation has been steadily increasing in lower credit scores

Lender Processing Services 21

2011 originations have experienced the largest increase in prepayments