The national mortgage loan 60-day delinquency rate decreased again in the second quarter of 2010 by 6.67%, suggesting that credit conditions in the housing sector are stabilizing, according to the latest quarterly analysis from TransUnion.
The Chicago-based company forecasts that the 60-day mortgage delinquency rate will likely continue to drift downward in 2010, possibly nearing 6.4% nationally by the end of the year.
"Although this is good news for the consumer, the economy is still burdened by high unemployment, upcoming ARM resets and a glut of foreclosures," said F.J. Guarrera, vice president in TransUnion's financial services business unit.
Sixty-two percent of the metropolitan statistical areas showed a decrease in their 60-day mortgage delinquency rates since last quarter, as compared to 59% between the fourth quarter of last year and first quarter of 2010.
Changes are even more significant in later stage delinquency measures. Sixty-four percent of all MSAs showed a decrease in their 90-day mortgage delinquency measure as compared to only 45% from the previous period.
The percentage of MSAs showing a decline in their 120-day delinquency ratio almost doubled from the previous quarter-over-quarter levels.
Year over year, TransUnion said mortgage borrower delinquency is still up approximately 14.8% (from 5.81% in the second quarter 2009).
Mortgage borrower delinquency rates in the 2Q continued to be highest in Nevada (15.86%) and Florida (15.02%), while the lowest mortgage delinquency rates were found in North Dakota (1.61%), South Dakota (2.23%) and Nebraska (2.61%).
Twelve states showed increases in delinquency from the previous quarter with Rhode Island (+4.63%), New Mexico (+4.45%) and Washington (+3.39%) leading the pack.
Measures of later-stage mortgage delinquency, such as the ratio of borrowers 90 or 120 or more days past due, provide additional positive news. For the first time since before the recession began in 2007, these later-state delinquency rates have now both declined nationally from where they were last quarter.
The average national mortgage debt per borrower again decreased 0.77% to $191,284 from the previous quarter's $192,774. On a year-over-year basis, the second quarter 2010 average represents a 1.3% decrease over the second quarter 2009 average mortgage debt per borrower level of $193,811.
The area with the highest average mortgage debt per borrower continued to be the District of Columbia at $366,627, followed by California at $345,502 and Hawaii at $311,130.
The lowest average mortgage debt per borrower remained in West Virginia at $99,206. Quarter over quarter, Vermont showed the greatest percentage increase in mortgage debt (+2.1%), followed by New Mexico (+1.96%) and North Dakota (+0.65%).
Areas showing the largest percentage drop in average mortgage debt were Nevada (-3.12%), Arizona (-3.0%) and Florida (-1.80%).
On a year-over-year basis at a national level, mortgage originations dropped almost 50%. The drop was across all states, with the smallest decline in year-over-year originations seen in North Dakota (-26.8%) and Arkansas (-31.4%). Idaho and Wisconsin experienced the steepest year-over-year declines (-58.7% and -58.6%, respectively).
