The delinquency rate on closed-end home equity loans rose 22 basis points in the second quarter at commercial banks, according to the American Bankers Association. In the second quarter, 2.56% of home equity loans were at least 30 days past due, up from 2.34% in the first quarter. However, the overdue rate on home equity lines of credit actually fell 2 bps to 1.08% in the second quarter, according to the ABA's Consumer Credit Delinquency Bulletin. ABA chief economist James Chessen said the rise in delinquencies on home equity loans reflected continued weakness in the housing sector and helped push up the ABA's composite consumer loan delinquency rate by 6 bps to 2.68% for the second quarter.
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