At the end of 2006, the percentage of home loans that were at least 30 days overdue rose to 4.95%, up from 4.67% at the end of the third quarter, according to the Mortgage Bankers Association's quarterly delinquency survey.The foreclosure rate also rose by 14 basis points, with 1.19% of all loans outstanding being at some point in the foreclosure process. The number of loans entering the foreclosure process rose to a record high of 0.54%, up eight basis points from the third quarter. Delinquencies rose across the board, but the steepest rise in late payments was seen in the subprime and FHA loan categories. The FHA delinquency rate reached a record high in the fourth quarter of 13.46%, up from 12.80% in the third quarter, and 13.33% of subprime loans were overdue, up from 12.56%. In addition, the MBA said that the delinquency rate on subprime adjustable-rate mortgages jumped by 122 basis points to 14.44%. MBA chief economist Doug Duncan said that given the MBA's forecast of "below-trend economic growth and a slowly recovering housing market," the MBA expects delinquency and foreclosure rates to level off toward the end of 2007.

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