Just when we thought our inventory challenges couldn’t get any worse … well they can. The Mortgage Bankers Association reported that delinquency rates fell 18 basis points in the third quarter of 2012 to 7.4%. This lower rate was driven by a drop in loans 90 days or more past due. The foreclosure inventory rate contracted 20 basis points to 4.7%. This drop was the largest quarterly drop in the history of the survey. This drop is significant and VERY positive for the housing industry. Foreclosure starts declined to the lowest level since the end of 2007.