FBR: Early Subprime MBS Overdues Dip

Early delinquencies on securitized subprime loans declined slightly in March for the first time in years, but the percentage of B&C loans 90 days or more past due rose nearly 30 basis points to 9.67%, according to a Friedman Billings Ramsey Investment Management report. In addition, loans in foreclosure jumped nearly 50 bps to 11.47%, the report says. FBRIM managing director Michael Youngblood says loss mitigation efforts and economic stimulus checks, along with seasonal factors, will provide a "temporary respite" from sharply rising 30-day and 60-day delinquencies this summer. However, the research director says he expects defaults to accelerate in September and the fourth quarter due to deteriorating labor market conditions and weak housing markets. The 30-day delinquency rate on securitized alternative-A mortgages fell back 13 bps to 3.97% in March, according to FBRIM. But the 60-day delinquency rate rose 13 bps to 2.2% and loans 90 days or more past due rose 35 bps to 3.36%. Alt-A mortgages in foreclosure rose 42 bps to 4.77%. FBRIM is a subsidiary of Friedman Billings Ramsey, which can be found online at http://www.fbr.com.