Rate of Mortgage Delinquencies is Dropping

At a time when mortgage rates are still low and there has been a drop in demand for loan applications, the number of homeowners who have delinquent mortgages is dropping. According to TransUnion, one of the three major credit reporting agencies, the delinquency rate for mortgage payments has dropped to only 6.44 percent during the third quarter of this year. That number represents the biggest drop in mortgage delinquencies since the end of 2006.

The rate of delinquencies is measured by counting the ratio of borrowers who are at least 60 days past due on their mortgage payments. Many analysts are looking at these numbers as a sign of an improving real estate and mortgage market. One reason for the turnaround is the fact that home prices have stabilized during the earlier part of the year. But the historically low mortgage rates are also being credited with the dropping delinquency rate. Here are some other numbers reported by TransUnion concerning the mortgage delinquency rate:

* Nevada had the highest number of delinquency rates in the country during the third quarter of this year at 15.12 percent. Florida was next highest at 14.63 percent.

* The lowest mortgage delinquency rates in the country were in North Dakota at 1.52 percent followed by South Dakota at 2.24 percent and Nebraska at 2.61 percent.

* More than half (58 percent) of the metropolitan areas in the nation reported a decrease in mortgage delinquencies that were 60 or more days late since last quarter.

* Compared to last year, new mortgages across the country have dropped 23 percent. All 50 states showed a decline in new mortgage loans when compared to last year’s numbers.

* During the third quarter of this year, the District of Columbia had the highest amount of mortgage debt on average at about $368,255. California had the second highest average at $342,695. awHHawaii had the third highest amount of mortgage debt on average with $309,536. West Virginia had the lowest average at just about $100,000.

Hopefully this trend of declining mortgage delinquencies will continue for this quarter and future quarters. Before long, the mortgage industry may get back on track or, at the very least, begin to improve in the foreseeable future.