U.S. home foreclosures hit another record
U.S. home foreclosures in the first three months of the year rose to all-time highs, the Mortgage Bankers Association said Thursday.
Almost one in every 100 mortgages — 0.99 per cent — was in the foreclosure process during the first quarter. That compares with 0.58 per cent a year earlier.
The mortgage delinquency rate — loans at least 30 days overdue — rose to a record high of 6.35 per cent, seasonally adjusted. That's the highest rate since the association began reporting such loan figures in 1979. The delinquency rate was 4.84 per cent in the first quarter of 2007.
Above-average foreclosure and delinquency rates were reported in California, Florida, Arizona and Nevada.
Among borrowers with subprime mortgages, the "seriously delinquent" rate — more than 90 days overdue — jumped five percentage points in the last year to more than 16 per cent.
Subprime loans account for 12 per cent of all housing loans, but represent half of all foreclosure proceedings.
Large numbers of subprime loans were given to people with poor credit ratings in the early part of the decade. When housing prices began to fall, many of these borrowers were unable to refinance their homes. Those with adjustable-rate mortgages found they were unable to afford their payments once interest rates reset at higher levels after their "teaser" rates expired.
More than one million home foreclosures are forecast for 2008 in the U.S. The median price for an existing single-family home slipped eight per cent year-over-year to $200,700 US in April, according to a national realty group. Further price drops are forecast, as the number of unsold homes is at a 23-year high.
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