Mortgage delinquency rates improve across key markets
Delinquency rates trend down for third consecutive quarter
The housing market continued to heal as the national mortgage delinquency rate dropped to 4.09% in the second-quarter of 2013, a drop of nearly 26% when compared to the same period last year, according to TransUnion’s quarterly report.
“This marks the third quarter in a row where we have posted all-time highs in terms of delinquency improvement and that is very welcome news for both borrowers and their lenders,” said Tim Martin, group vice president of U.S. Housing in TransUnion’s financial services business unit.
Individually, every state and the District of Columbia posted an improvement in their mortgage delinquency rate from last year.
Florida and Nevada, the two states with the highest mortgage delinquency rates, experienced drops of 26.8% and 28.7%, respectively.
“Many of the delinquent mortgages we have been tracking have been delinquent for a very long time, so it is encouraging to see this number is coming down so significantly,” Martin said.
Additionally, 95.4% of metropolitan statistical areas experienced a yearly drop in their delinquency rate, compared to only 91% the previous quarter.
Several major markets posted steep double-digit drops, including Phoenix and San Francisco, which posted declines of 47.7% and 43.7%, respectively.
“Improving house prices and low interest rates have helped some homeowners across the country refinance or sell their way out of mortgage payments they were having difficulty affording,” said Martin.
“While we expect these positive factors to continue reducing the mortgage delinquency rate throughout 2013, the recent and sizable increase in mortgage interest rates may eventually slow the progress,” he added.
Looking ahead, TransUnion expects the mortgage delinquency rate to continue to steadily decline in the third quarter of 2013, finishing below 4% for the first time since 2008.