Monday, 19 March, 2018

U.S. mortgage delinquencies rise in fourth quarter of 2016: MBA

Nellie Chapman | 17 February, 2017, 01:04

It was the lowest foreclosure start rate since the fourth quarter of 1988.

Mortgage delinquencies (loans that are 60 days or more past due but not in foreclosure) were at about 4.80% as of the end of the fourth quarter, an increase of 28 basis points compared with the third quarter but only three basis points higher compared with the fourth quarter of 2015, according to the Mortgage Bankers Association's (MBA) National Delinquency Survey. This was the lowest foreclosure inventory rate since the second quarter of 2007.

"Rates continued to increase in January and with that we began to see an uptick in adjustable rate mortgages, a trend that we will watch throughout the year", said Jonathan Corr, president and CEO of Ellie Mae.

It is unclear if something major is about to happen, but if the problems continue to pile up then it could impact United States taxpayers. That's up from 8.30% in the third quarter. The group's seasonally adjusted gauge on overall mortgage application activity fell 3.7 percent to 379.00, its lowest level since late December.

The average loan for new homes decreased slightly to $329,806 in January 2017 from $331,354 in December 2016. On a year-over-year basis, the VA delinquency rate declined 12 basis points. The rate is still higher than it was a year ago. Mortgage rates have retreated from more than two-year peaks in step with lower bond yields. On a year-over-year basis, the conventional delinquency rate increased by 6 basis points. Points for 80% LTV loans decreased to 0.31 from 0.37. Foreclosure starts in the fourth quarter decreased across all loan types - FHA, VA and conventional. New Jersey and NY continued to have the highest percentage of loans in foreclosure, at 5.42 percent and 4.28 percent, but also continued to show improvement from the previous quarter.

Mortgage applications to purchase a home, which are less rate-sensitive week to week, fell 5 percent from a week earlier and are just 3 percent higher than a year ago. "Over 70 percent of seriously delinquent loans were attributable to loans originated in 2007 and earlier".