First American CoreLogic Releases Fourth Quarter 2008 Core Mortgage Risk Monitor
—Core Mortgage Risk Index 54 Percent Higher Compared to 2002 Base Year as Economic Conditions Drive Geographic Expansion of Risk—
November 26, 2008, SANTA ANA, Calif.
First American CoreLogic, a member of The First American Corporation (NYSE:FAF) family of companies, America’s largest provider of advanced property and ownership information, analytics and services, today released the latest issue of its Core Mortgage Risk Monitor (CMRM). The CMRM forecasts delinquency risk for the real estate and mortgage industry, providing a barometer on the areas that are the most and least risky in terms of homeowners facing foreclosures due to mortgage default.
According to the study, the likelihood that homeowners will default on their mortgages increased by 12 percent from a year ago and is up 54 percent from early 2002. The full report, including the 10 highest risk markets and the 10 lowest risk markets, is available at www.facorelogic.com/newsroom/newsroom.jsp.
“The rate of home price decline, an important factor in assessing likely delinquency risk, has stabilized at around 11 percent, with almost zero acceleration in either direction,” said Mark Fleming, chief economist with First American CoreLogic.
“Because this rate is not increasing, home price declines are not raising the national risk index further at this time, but they’re not reducing the risk either. While the risk index has been driven upward throughout 2007 and 2008 primarily by the acceleration of declines in home prices, there is now a geographic expansion of risk driven by fundamental economic conditions. Flat or declining wages and increasing job losses are beginning to affect the index more heavily in many markets.”
California tops the list with seven of the eight riskiest markets, including the top three—Riverside/San Bernardino, Los Angeles and Sacramento. Florida is second on the list with one city—Miami—in the top 10 and several other cities, including Fort Myers and Port St. Lucie, also having high risk factors. Dayton, Ohio, is the least risky market, according to the CMRM. Indianapolis; Austin, Texas; Omaha, Neb.; and Wichita, Kan., are also among the five least risky markets.
The Core Mortgage Risk Monitor is a quarterly report that provides an economic forecast, analysis and commentary on the relative risk of residential mortgage loan delinquencies due to fraud propensity and collateral risk, house price dynamics and the health of the local market economy. The Core Mortgage Risk Monitor tracks risk in 381 metropolitan markets across the United States representing more than 89 percent of the United States. The Core Mortgage Risk Index (CMRI) is the basis for the forecast. An elevated CMRI signals the increased potential for financially disruptive and costly economic consequences for consumers, their local community and the mortgage industry.
About First American CoreLogic
First American CoreLogic, a member of The First American Corporation (NYSE:FAF) family of companies, is the largest provider of real estate, property and ownership data and advanced analytics for information on foreclosures, delinquencies, median home prices, home price indices, home valuations, sales activity and mortgage loan originations. The market-specific data covers 7,620 ZIP codes, 958 Core Based Statistical Areas (CBSA) and 3,050 counties located in all 50 states and the District of Columbia. This data represents 99 percent of the United States population, 140 million (97 percent) of all properties, more than 50 million active mortgages and $2 trillion in loan-level, non-agency mortgage securities. First American CoreLogic’s products and services enable customers to better manage mortgage risk, protect against fraud, acquire and retain customers, manage credit risk, mitigate loss, decrease mortgage transaction cycle time, more accurately value properties and determine real estate trends and market performance. More information about First American CoreLogic can be found at www.facorelogic.com.
About First American
The First American Corporation (NYSE: FAF) is a FORTUNE 500® company that traces its history to 1889. With revenues of approximately $8.2 billion in 2007, it is America’s largest provider of business information. First American combines advanced analytics with its vast data resources to supply businesses and consumers with valuable information products to support the major economic events of people’s lives, such as getting a job, renting an apartment, buying a car or house, securing a mortgage and opening or buying a business. The First American Family of Companies, many of which command leading market share positions in their respective industries, operate within five primary business segments, including: Title Insurance and Services, Specialty Insurance, Information and Outsourcing Solutions, Data and Analytic Solutions, and Risk Mitigation and Business Solutions. More information about the company and an archive of its press releases can be found at www.firstam.com.