A new report from real estate data firm Lender Processing Services shows that the percentage of delinquent loans has declined, but the high percentage of underwater loans is still helping to drive homeowners into foreclosure, and many loans are staying stuck in the foreclosure inventory for lengthy periods.

Nationwide, the percentage of delinquent loans has dropped about 30 percent from its peak in 2010. In Massachusetts, the percentage of delinquent loans has only dropped 16.4 percent from its peak. Currently, Massachusetts ranks 24th  in the nation with 10 percent of Massachusetts loans  non-current loans (delinquencies plus foreclosures), down 0.4 percent from this same time in 2011, according to LPS. Across the country, 18 percent of current loans remain underwater; in Massachusetts, that figure is less than 10 percent.

"The July mortgage performance data shows a continuing correlation between negative equity and new problem loans," said Herb Blecher, senior vice president, LPS Applied Analytics, in a statement.  "As negative equity increases, we see corresponding increases in the number of new problem loans. In Nevada and Florida, two of the states with the highest percentage of underwater borrowers, more than 3 percent of borrowers who were up to date on their payments are 60 or more days delinquent six months later. This suggests that further home price declines – should they occur – could jeopardize recent improvements."

The July data also shows that non-judicial foreclosure states continue to see greater improvement in non-current rates (including loans 30 or more days delinquent or in foreclosure) than those in their judicial counterparts. On a year-over-year basis, judicial states have seen non-current inventories decline 3.1 percent as compared to an 8.7 percent drop in non-judicial states. Looking at the change from the peak, the non-current inventory in non-judicial states was down 31 percent compared to a decline of 13 percent in judicial states. A few states on both sides of the foreclosure process – Washington (non-judicial), New Jersey and Vermont (both judicial) still remained at historic highs as of the end of July.

Editor’s note: Changed to reflect that the percentage of underwater loans refers to current, non-distressed loans.