Mortgage Delinquencies Continue to Rise

Mortgage loan delinquencies increased for the fifth consecutive quarter, according to, with a national average high of 3.23% in the first quarter ended March 31, up from 2% in the year-ago period – a 61.5% increase. Delinquencies are measured as the ratio of borrowers 60 or more days past due.

"The market continues to see the effect of the mortgage crisis across the country as delinquency rates again increased over the previous period," says Keith Carson, a senior consultant in TransUnion's financial services group. "However, this increase was not as substantial as was seen between the third and fourth quarters of 2007, possibly reflecting the impact of a tightening in the lending policies of financial institutions."

Nevada reported the highest mortgage borrower delinquency rates in the first quarter, at 5.81%, followed by Florida at 5.38%. The lowest rates were found in North Dakota (1.17%), Wyoming (1.41%) and South Dakota (1.48%).

The top three areas with the greatest growth in delinquencies from previous quarters were Alaska (28.4%), California (25.4%) and Nevada (24.1%). Several states actually experienced a drop in delinquencies over the previous quarter including Wyoming, Louisiana and Mississippi.

Average national mortgage debt per mortgage borrower in the first quarter ticked upward (0.29%) to $191,917 from the previous quarter's $191,370 total. However, the first quarter average represents a 5.38% increase compared to the first quarter 2007 of $182,126.

While the immediate forecast is gloomy, "The national 60-day mortgage delinquency rate among mortgage borrowers is expected to continue to rise throughout 2008 from a value of 3.23% in the first quarter of 2008 to just over 4% by year end," said Carson, the longer-term outlook is better.

TransUnion forecasts that in 2009 the rise in mortgage delinquency rates is expected to taper as economic conditions improve and home prices begin to stabilize.

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