According to the Mortgage Bankers Association, the residential mortgage delinquency rate reached 9.24% at the end of the second quarter of 2009. The delinquency rate at the end of the second quarter of 2008, was 6.41%. This is the highest delinquency rate since the MBA started keeping records in 1972.
This does not include homes in the foreclosure process. At the end of the second quarter of 2008, 2.75% of homes were in foreclosure; at the end of the second quarter of 2009, the number of homes in foreclosure had increased to 4.3%.
The end result is that 13.16% percent of all home loans were either delinquent or in the process of foreclosure; the highest ever recorded.
One more troubling fact is that many of these loans are NOT subprime ARMs, but rather are prime fixed-rate loans; an indication that the foreclosures are being driven by unemployment. With unemployment expected to continue to rise into 2010, one could expect foreclosure to continue to rise throughout 2010 and possibly into 2011.
