Foreclosures, Delinquencies Hit Records
Foreclosures and mortgage delinquencies both continued to rise during the first quarter of 2008, hitting their highest levels since record-keeping began in 1979, according to the Mortgage Bankers Association.
The seasonally adjusted delinquency rate for mortgage loans on one-to-four-unit residential properties stood at 6.35 percent of all loans outstanding at the end of the first quarter of 2008 on a seasonally adjusted (SA) basis, up 53 basis points from the fourth quarter of 2007, and up 151 basis points from one year ago, according to MBA’s National Delinquency Survey. The delinquency rate includes loans that are at least one payment past due but does not include loans in the process of foreclosure.
The percentage of loans in the foreclosure process was 2.47 percent at the end of the first quarter, an increase of 43 basis points from the fourth quarter of 2007 and 119 basis points from one year ago.
While these numbers seem disturbingly high, experts note that certain states and certain types of loans are skewing the national figures upward. Specifically, most of the problems step from prime and subprime adjustable-rate loans 60 and 90 days past due in California and Florida.
The 30-day delinquency rate is still below levels seen in 2002.
“The problems in California and Florida are extraordinary and they are the main drivers of the national trend,� said Jay Brinkmann, MBA’s Vice President for Research and Economics.
The quarterly rate of foreclosure starts on subprime ARM loans in California was 9.24 percent. This rate, combined with Florida’s rate of 8.25 percent, drove up the national average foreclosure start rate to the point where 43 states were below the national average of 6.32 percent.
California saw a total of approximately 109,000 foreclosure starts and Florida 77,000. The next highest states were Texas, Michigan and Ohio with between 24,000 and 20,000 each.
About 20 states had drops in their number of foreclosures started, including Michigan, Ohio and Indiana where problems have been the most severe for the last several years, Brinkmann said.
Source: The Mortgage Bankers Association (06/06/2008)
Posted by Carter Brown
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