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Economy
Mortgage Delinquencies Hit Record High
2009-05-28
NEW YORK — An industry report shows that a record 12 percent of U.S. homeowners with a mortgage are behind on their payments or in foreclosure as the housing crisis spreads to borrowers with good credit.

The Mortgage Bankers Association said Thursday the foreclosure rate on prime fixed-rate loans doubled in the last year, and now represents the largest share of new foreclosures. Nearly 6 percent of fixed-rate mortgages to borrowers with good credit were in the foreclosure process.

At the same time, almost half of all adjustable-rate loans to borrowers with shaky credit were past due or in foreclosure.

California, Nevada, Arizona and Florida accounted for 46 percent of new foreclosures in the country.
Posted by:GolfBravoUSMC

#8  "Nearly 6 percent of fixed-rate mortgages to borrowers with good credit were in the foreclosure process."

That means that mortgage rates SHOULD be base + 600 base points!

or about 7% to you.
Posted by: Bright Pebbles   2009-05-28 15:09  

#7  maybe the prime borrowers are just walking away from upside down houses.

I've heard of it happening, but only "friend-of-a-friend" type stuff. No one I know personally is admitting to doing that.
Posted by: Grenter, Protector of the Geats   2009-05-28 14:26  

#6  Just read in Bloomberg that for the first time since the crisis began prime borrowers represent the majority of foreclosures. That's quite a bit more disturbing than the subprime crowd defaulting. Strange things are afoot, maybe the prime borrowers are just walking away from upside down houses. I dunno.
Posted by: bigjim-ca   2009-05-28 14:03  

#5  I had a hunch about that; do you have a a link to that data?

Sorry, no. The company which did the study does not want to publish these findings.
Posted by: Iblis   2009-05-28 13:59  

#4  That is heresy that you are speaking, Anguper.
Nevermind that home prices up until last year were inflated way beyond the point where anybody could afford them without a subprime mortgage. But, exactly opposite from their stated purpose of making homes more affordable, the subprime mortgages allowed people to buy over their heads thereby causing even more inflation. It's funny to remember how all the politicians and developers used to speak about the need for affordable housing but now that housing is becoming just a bit more affordable there is all this wailing and gnashing of the teeth. It was all a lie. But all that money had to go somewhere. When the banks made those loans, somebody got the money. Somebody has to be sitting pretty now. I wonder who.
Posted by: Ebbang Uluque6305   2009-05-28 13:56  

#3  2/3 of foreclosures are homes owned by "real estate professionals"

I had a hunch about that; do you have a a link to that data?
Posted by: Grenter, Protector of the Geats   2009-05-28 13:47  

#2  This current peak in delinquencies was predicted a couple of years ago. There is another one predicted to max out in about 12 months. The government's stated policy of keeping house prices elevated is stupid and counterproductive. House prices need to fall hard so that people can truly affordd them.
Posted by: Anguper Hupomosing9418   2009-05-28 13:22  

#1  2/3 of foreclosures are homes owned by "real estate professionals" -- i.e. your friendly neighborhood agent who was buying houses to flip.

In other news, efforts by the gummint to "stabilize" home prices at their current inflated levels will inevitably lead to more foreclosures for the same reason that an artificially high minimum wage leads to unemployment.
Posted by: Iblis   2009-05-28 13:09  

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