be delinquent in understanding how delinquent all of U.S. are...
While those in "foreclosure" appear, at first, to be stable...
that does NOT factor in those "in modification", nor those in "short sales" negotiations/sales.
What is also significant is that those in 90 delinquencies are getting worse.
while those in short or 30 delinquencies appear to be correcting themselves.
What you need to do is look at WHERE the new delinquencies are taking place = Prime loans.
The long term delinquent might be underwater sand states home owners.
There no body or entity can figure out how to fix their problem, any time soon.
Those home owners are prime candidates for becoming walk-away - strategic defaults.
With the delinquencies shifting from subprime borrower in the sand states
over to Prime Rate borrower all over the country...
we see that the states with the largest rise in delinquencies & foreclosures
are now in places like Washington and Oregon - two of the top four states.
In the CoreLogic report we see home prices falling again.
In another recent article it was pointed out to U.S. that sellers were cutting prices a lot more.
That was probably caused by the end of the Buyer Tax Credit.
Getting the sale CLOSED prior to the end, so they could get rid of the home.
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Note: larger charts are available at the CR web blog page
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by CalculatedRisk on 5/19/2010 11:06:00 AM
On the MBA conference call concerning the "Q1 2010 National Delinquency Survey", MBA Chief Economist Jay Brinkmann said this morning:
These are "extraordinary times" and the seasonal adjustment may be incorrect. The 90+ day delinquency bucket is very high and might not be seasonal. If that is backed out, delinquencies are "flat".
FHA foreclosure starts up sharply.
"Shadow inventory" of 4.3 million loans that need to worked through (90 day delinquent or in foreclosure) - or they will become REOs or distressed sales.
Prime fixed rate is now the key problem!
"Sand states" will not be as dominant as the problem moves to prime fixed rate.
Still expect some improvement this year for delinquencies, although a little less optimistic than last quarter.
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Wednesday, May 19, 2010
by CalculatedRisk on 5/19/2010 04:01:00 PM
The second graph shows the delinquency rate by state (red is seriously delinquent: 90+ days or in foreclosure, blue is delinquent less than 90 days).
This highlights a couple more points that Brinkmann made this morning:
1) the largest category of delinquent loans are fixed rate prime loans, and
2) this is not just a "sand state" problem.
Brinkmann argued the foreclosure crisis is now being driven by economic problems as opposed to the bursting of the housing price bubble - and this is showing up in prime loans and all states. Although Florida and Nevada are very high, notice that the blue bar (new delinquencies) are higher in many other states
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