TransUnion's quarterly analysis of trends in the mortgage industry found that the national mortgage loan delinquency rate (the ratio of borrowers 60 or more days past due) decreased again in the second quarter, suggesting that the credit conditions in the housing sector have now begun to stabilize. However, the delinquency rate only dropped to 6.67% – a level marginally lower than in the first quarter of this year.
This statistic reflects a decrease of 1.48% from the previous quarter's 6.77% national average. Mortgage borrower delinquency is still up approximately 14.8% year over year (from 5.81% in the second quarter of 2009).
Borrower delinquency rates in the second quarter of this year continued to be the highest in Nevada (15.8%) and Florida (15.02%), while the lowest mortgage delinquency rates continued to be 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-stage delinquency rates have now declined nationally from where they were last quarter.
Just as mortgage delinquency trends differ between the national and state economies, metropolitan areas also showed different movements in the second quarter of this year. Sixty-two percent of the metropolitan statistical areas (MSAs) 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. Furthermore, the percentage of MSAs showing a decline in their 120-day delinquency ratio almost doubled from the previous quarter-over-quarter levels.