In a report released today, Barclays Capital analysts gave their predictions regarding the April remittance reports, which reflect activity in March.
According to analysts, historically the March collection period has yielded improving delinquency performance for every year since 2001.
For April 2009 remits, they said that favorable seasonal effects should continue to keep the growth of delinquencies down.
Analysts anticipate that serious delinquencies will rise by 50 basis points, 60 basis points, and 140 basis points for the 06-1, 07-1, and 07-2 series, respectively, which is a smaller rise compared with last month. Analysts believe that series 06-2 will post a bigger increase in serious delinquencies versus last month (90 basis points compared with 80 basis point) as a result of the early stage delinquencies for two RFC deals in this series spiked last month because of the rapid re-defaults of previously modified loans.
Considering the slightly improved liquidation rates last month as well as the three more business days in April versus March, analysts believe that CDRs will post a moderate increase of 10 to 70 basis points this month for the four ABX indices despite a shrunk REO bucket. Voluntary prepays, they said, should also benefit from the higher day count and they think that CRR will stay flat or rise slightly for the 06-1 through 07-1 series. The 07-2 series is still coming off the peak of first rate reset and should post a small decline in CRR.
Nationwide REO inventories dropped by -1.6% to 825,000 homes in February, according to Barclays analysts. They are projecting a flat to 1% increase in March.