Thursday, June 05, 2008

Delinquencies & Foreclosures Surge in 1st Quarter

The delinquency and foreclosure rate for housing units surged in the 1st quarter of 2008.
"The latest snapshot of the mortgage market, released Thursday, showed that the proportion of mortgages that fell into foreclosure soared to 0.99 percent in the January-through-March period. That surpassed the previous high of 0.83 percent over the last three months in 2007. The report by the Mortgage Bankers Association also found that more homeowners slipped behind on their monthly payments.

The delinquency rate jumped to 6.35 percent in the first quarter, compared with 5.82 percent for the three months earlier. Payments are considered delinquent if they are 30 or more days past due.

Both the rate of new foreclosures and late payments were the highest on record going back to 1979. (AP June 5, 2008)

The foreclosure rate will most probably continue to rise in the coming year as a wave of widely used option arms are resetting and as the economy deteriorates further. In the overwhelming majority of bubble areas 2008 will not be the bottom (for prices). This bust continues.

1 comment:

  1. Presumably the lenders will tighten up their standards. Hopefully, the government will do nothing; the private sector is capable of dealing with the situation