MBA Report Shows “Bubble” of Serious Mortgage Delinquencies Still Growing Despite Servicer Efforts
Center for Responsible Lending
August 20, 2009
The Mortgage Bankers Association (MBA) reported today that serious mortgage delinquencies (those 90+ days past due or in foreclosure) reached record levels in 2nd Quarter 2009, surpassing the previous record set one quarter earlier. According to new MBA statistics, over 13% of all loans are now past due and 1 in 12 borrowers is seriously delinquent on their mortgage. By comparison, one year earlier just 1 in 22 borrowers was seriously delinquent, and two years ago only 1 in 40 was.
This shows that the proportion of struggling homeowners continues to climb—even though the percent of mortgage foreclosure starts remained relatively constant from first to second quarter 2009. Moreover, no segment of loans (subprime, prime, and FHA) has been immune to this deterioration. Clearly loan servicers are not helping enough troubled borrowers through voluntary loan modification efforts and, as a result, prospects for an improved housing market remain distant.
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About the Center for Responsible Lending
The Center for Responsible Lending is a nonprofit, nonpartisan research and policy organization dedicated to protecting homeownership and family wealth by working to eliminate abusive financial practices. CRL is affiliated with Self-Help, one of the nation's largest community development financial institutions.