The Mortgage Bankers Association has announced that 9.64% of all mortgages are now delinquent, and this delinquency rate breaks the record set last quarter. The records are based on MBA data dating back to 1972.
The delinquency rate does NOT include loans that somewhere in the process of foreclosure. If you combine the current foreclosures with the delinquents, you get a whopping 14.41 percent.
The MBA didn’t pull any punches when assessing the situation (emphasis ours):
“The outlook is that delinquency rates and foreclosure rates will continue to worsen before they improve. First, it is unlikely the employment picture will get better until sometime next year and even then jobs will increase at a very slow pace.
Perhaps more importantly, there is no reason to expect that when the economy begins to add more jobs, those jobs will be in areas with the biggest excess housing inventory and the highest delinquency rates.
Second, the number of loans 90 days or more past due or in foreclosure is now a little over 4 million as compared with 3.9 million new and previously occupied homes currently for sale, although there is likely some overlap between the two numbers. The ultimate resolution of these seriously delinquent loans will put added pressure on the hardest hit sections of the country.”
Delinquencies Continue to Climb in Latest MBA National Delinquency Survey (Press Release) [MBA]
(Photo:Nick Bastian Tempe, AZ)