The September Mortgage Monitor report released by Lender Processing Services looked at the significant month-over-month increase in the nation's delinquency rates – up 7.7 percent from August, and representing the largest monthly increase since 2008. While September has historically been marked by seasonal rises in delinquencies, this was still a marked upturn. However, according to LPS Applied Analytics Senior Vice President Herb Blecher, it is important to view the month's data in its proper context.

"September's increase in the delinquency rate was indeed significant, but the overall trend is still one of improvement," Blecher said. "Despite the monthly jump, delinquencies are down 30 percent from their January 2010 peak, and our analysis revealed some interesting factors related to the spike. Of course, one month's data does not indicate a trend. We will be monitoring these factors over the coming months to see how the situation develops."

Blecher continued, "September 2012 was notable in its short duration of business days and virtually all transactional or operational metrics we observed declined in volume for the month; foreclosure starts, foreclosure sales, delinquent cures and loan prepayments all dropped from their August levels. It is important to note that we also saw the percentage of re-defaulting modifications contributing to the delinquency rate actually declined from the month prior."

Newly available origination data also provided additional insight into the increase seen in August's prepayment rates. After allowing a month for loan data to board, originations in August were found to be up 13.2 percent month-over-month and 42.1 percent year-over-year, reaching their highest point since 2009. The data shows that high loan-to-value HARP originations made up nearly a quarter of August originations.

As reported in LPS' First Look release, other key results from LPS' latest Mortgage Monitor report include:

*Non-current totals combine foreclosures and delinquencies as a percent of active loans in that state.

Totals are extrapolated based on LPS Applied Analytics' loan-level database of mortgage assets.