Mortgage Delinquency Spikes in TransUnion Q4 Report


TransUnion is reporting that serious
mortgage delinquencies rose
during the fourth quarter of 2011 for only the
second time since the end of 2009.  The
rate increased 13 basis points from 5.88 percent in the third quarter to 6.01

The increase was widespread; 37
percent of the states reported increases as did 64 percent of metropolitan
areas.  The latter figure is unchanged
from Quarter 3 but up substantially from the 21 MSAs that experienced an
increase in Quarter 2.  New Jersey and
Vermont had the largest annual increases. 
Their delinquency rates rose between Quarter 4, 2010 and Quarter 4, 2011
by 11.98 percent and 11.11 percent respectively.  South Dakota had an increase of 10.36
percent.  Arizona, California, and
Wyoming had the greatest decreases in their rates, all three in the range of 20

The highest serious delinquency
rates, defined as over 60 days, were reported in Florida (14.27 percent),
Nevada (12.08 percent) New Jersey (8.32 percent) and Arizona (7.50 percent) and
the lowest rates in North Dakota (1.50 percent), South Dakota (2.45 percent),
Nebraska (2.57 percent) and Alaska (2.77 percent).

“To see that, quarter over
quarter, fewer homeowners were able to make their mortgage payments is not
welcome news,” said Tim Martin, group vice president of U.S. Housing in
TransUnion’s financial services business unit. “However, it was not
unexpected. First, there tends to be a natural seasonality, evident well before
the recession, of higher delinquencies in the fourth quarter; perhaps explained
by borrowers balancing holiday spending vs. debt payments. Secondly, on the
economic front, house prices continued to deteriorate in the fourth quarter and
unemployment remained stubbornly high. This combination leads to more negative
equity in homes and reduced real personal income that can affect borrowers’
ability and willingness to pay their mortgages.

Leave a Reply