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Downward trend in foreclosure rates welcomed in Mississippi

While Mississippi has fared among the best 10 states when it comes to foreclosure rates since the housing bubble burst in 2007, recent indications that foreclosures in the state are decreasing come as welcome news.

The largest bank headquartered in the state, BancorpSouth, Tupelo, is continuing to experience significantly lower number of home foreclosures compared to national and regional averages.

“On a national level, according to the latest Mortgage Bankers Association surveys, our foreclosure rates are as much as 50 percent less than other lenders, and have been even prior to and during the recession and housing down turn,” said Randy Burchfield, senior vice president, director of corporate marketing, BancorpSouth. “At the same time, our delinquency rates continue to improve, even though we didn’t see the spike that many others in the industry experienced.”

Regions Bank also reports improvement, in part linked to programs to help people who have run into problems making payments.

“The amount of our bad loans continues to decrease on all types of distressed loans, commercial and individual mortgages,” said Mel Campbell, spokesman for Regions Bank, which has 147 bank branches in the state. “All of those have reduced. We have seen declines quarter over quarter for some time now. We have had multiple programs in place for years, some since 2006, to help our customers who might be facing economic pressures. With our customer assistance program, we have helped 42,000 customers stay in their homes with restructuring of loans and deferrals of payments.”

Campbell said Regions’ foreclosure rate was about half of the national average in the third quarter of 2011 with Regions’ rate at 1.7 percent compared to a national average of 4.4 percent.

Regions saw a first quarter of 2012 that resulted in significant asset quality improvement. The provision for loan losses totaled $117 million or $215 million less than net charge-offs, the lowest quarterly loan loss provision in more than four years.

Renasant Bank, Tupelo, is seeing decreases in both large and small foreclosures.

“Foreclosure rates are certainly slower than they have been in recent years,” said John Oxford, director of external affairs, Renasant Bank. “We’re also seeing encouraging signs as land and lots sales have begun to pick up, whereas just a short time ago, nothing was moving. Overall, the outlook is beginning to trend in a positive direction. We’ve seen a turnaround within the last three quarters.”

Trustmark Bank also reports seeing delinquency and foreclosure trends begin to stabilize.

Breck Tyler

“Delinquent and seriously delinquent loans, as well as new foreclosure filings, are decreasing,” said Breck Tyler, president of mortgage services for Trustmark. “A couple of reasons for recent improvement include some stabilization in employment, and the fact that delinquent customers are working closely with their servicer in terms of accurately processing and returning their loss mitigation packages to the servicer. Upon receiving this complete package, the servicer will contact the borrower to discuss potential eligibility for a loan modification or other types of assistance. Properties already in foreclosure remain historically high and it will take time to work through this inventory.”

The number of foreclosures in recent years has been the most Chevis Swetman, president and CEO, The People’s Bank, Biloxi, has seen in his 41 years in banking. But there seem to be marked differences on the Coast with few foreclosures in Jackson County and then foreclosures increasing as you move to the west.

People’s Bank hasn’t foreclosed on any properties in Gautier, Ocean Springs, D’Iberville or Biloxi, but has had a few in Gulfport and more in Hancock County.

“Most of our foreclosure activity is west of Highway 49,” Swetman said. “I don’t know what to really relate it to. Biloxi was worse than Gulfport in Hurricane Katrina damage. Every time we have to repossess property, we put it out on our website, and people ask, ‘Do you have anything in the Ocean Springs or Biloxi area?’ We just don’t seem to have inventory in that area. Is that because of better underwriting? Or is that because the further west you go, there is less infrastructure improvement? If I could lay my finger on it, we could react accordingly. Some of it has to do with it being so hard to get infrastructure up and running in those areas after the storm.”

Jobs could be another issue. Margaritaville opened recently in Biloxi, and is employing 1,000 people.

Swetman said his bank saw the largest charge off on loans in 2009 and 2010. While it sold 11 properties in 2009, 14 in 2010 and 25 in 2011, the dollar value of foreclosed properties was lower in 2011 than the other years.

Another factor could be that with rates of return so low on CDs, people are purchasing rental properties to have investment income.

In its U.S. Foreclosure Market Report for April 2012, RealtyTrac reports nationwide foreclosures were the lowest monthly total since July 2007. April foreclosure activity decreased 5 percent from the previous month and was down 14 percent from April 2011. According to RealtyTrac, Hinds County leads the state’s foreclosure rates with 687 foreclosures. Harrison County has the next largest number of foreclosures with 268. DeSoto County has had 261 and Jackson County 200. Rankin County has seen 116 foreclosures.

Foreclosures in Mississippi

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