The percentage of homes in the foreclosure process hit a new record in the second quarter, and homes continued to enter the foreclosure process at a record rate, the Mortgage Bankers Association said today.

In looking at the nation as a whole, a majority of states saw little change, but increases in foreclosures in California and Florida outweighed improvements in states such as Texas, Massachusetts and Maryland, said MBA chief economist Jay Brinkmann.

The percentage of loans in the foreclosure process at the end of the second quarter was 2.75 percent, compared with 2.47 percent in the first quarter and 1.4 percent a year ago.

The percentage of loans on which foreclosure actions were started hit 1.08 percent, up from 1.01 percent last quarter and 0.59 percent a year ago.

With California and Florida accounting for 39 percent of all foreclosures starts, and 73 percent of the increase in foreclosures between the first and second quarters, it’s "somewhat meaningless" to look for a national bottom, Brinkmann said.

Michigan, one of the hardest-hit markets in the country, has now gone three quarters with little to no increase in its rate of foreclosures, he said. Massachusetts showed a very large drop in foreclosure starts, perhaps signaling a bottom.

But "because of the sheer size of California and Florida, an improvement in the national numbers, whether delinquencies, home prices or any other measure, is unlikely until we see some turnaround in those two states," Brinkmann said.

Addressing the Florida Bankers Association Thursday, Federal Deposit Insurance Corp. Chairwoman Sheila Bair said bankers "simply must accept that the credit downturn is far from over. It’s a tough slog, but there’s no easy way out."

Bair said 10 banks have failed this year and more are expected to, which could force the FDIC to raise premiums to boost reserves (see story). Defaults are rising across all types of loans, with residential mortgage loans accounting for the largest share of the increase in the second quarter, Bair said.

The MBA said the delinquency rate for all residential mortgage loans stood at 6.41 percent at the end of the second quarter, compared with 6.35 percent in the first quarter and 5.12 percent a year ago on a seasonally adjusted basis. The delinquency rate for prime loans climbed to 3.93 percent, while the delinquency rate for subprime loans fell slightly to 18.67 percent.

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