Delinquent Mortgages Will Set a Record This Year

Written by: Steve Cook   Tue, November 17, 2009 Beyond Today’s News, Crisis Watch

Mortgage delinquencies hit an all-time high of 6.25 percent in the third quarter and they will continue to rise just short of 7 percent by year end, breaking the record for annual delinquencies, according to TransUnion’s analysis of trends in the mortgage industry. The delinquency rate is based on loans overdue by 60 days or more, which are considered a precursor to foreclosures.

The delinquency rate increased 7.57 percent from the second quarter’s 5.81 percent average, which reflects a slow down in the rate of new delinquent loans.  From the fourth quarter 2008 to first quarter 2009, delinquencies increased 14 percent and from the first quarter to second quarter 2009, they increased by 11.3 percent.

Year-over-year, mortgage borrower delinquency is up approximately 58 percent (from 3.96 percent). is traditionally seen as a precursor to foreclosure and

Mortgage borrower delinquency rates in the third quarter of 2009 continued to be highest in Nevada (14.5 percent) and Florida (13.3 percent), while the lowest mortgage delinquency rates were found in North Dakota (1.7 percent), South Dakota (2.3 percent) and Vermont (2.6 percent). Areas showing the greatest percentage growth in delinquency from the previous quarter were Wyoming (+17.9 percent), Kansas (+17.4 percent) and North Dakota (+16 percent). Bright spots for the quarter included the District of Columbia, showing a decline in mortgage delinquency rates, down 0.19 percent from the previous quarter.

The average national mortgage debt per borrower dropped (0.36 percent) to $193,121 from the previous quarter’s $193,811. On a year-over-year basis, the third quarter 2009 average represents a 0.43 percent increase over the third quarter 2008 average mortgage debt per borrower level of $192,287.

The area with the highest average mortgage debt per borrower was the District of Columbia at $359,788, followed by California at $354,510 and Hawaii at $312,844. The lowest average mortgage debt per borrower was in West Virginia at $97,265. Quarter over quarter, South Dakota showed the greatest percentage increase in mortgage debt (+2.2 percent), followed by Montana (+1.96 percent) and Wyoming (+1.7 percent). Areas showing the largest percentage drop in average mortgage debt were Nevada (-2.6 percent), Vermont (-1.97 percent) and California (-1.4 percent).’s  analysis of trends in the mortgage industry for the third quarter of 2009 is part of an ongoing series of quarterly consumer lending sector analyses focusing on credit card, auto loan and mortgage data available on TransUnion’s Web site at Information for this analysis is culled quarterly from approximately 27 million anonymous, randomly sampled, individual credit files, representing approximately 10 percent of credit-active U.S. consumers and providing a real-life perspective on how they are managing their credit health.

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