Mortgage Loan Delinquency Rates Rise 54 Percent from Previous Year

It would be stating the obvious to say we are in a mortgage crisis, but the daily financial news makes it hard not to regularly restate the facts. Despite the variety of government bailout programs and government refinance and assistance programs the economy and the housing market continues to stall. The net effect is that the mortgage market and homeowners continue to move into uncharted and desperate waters.

Transunion, one of the primary credit reporting bureaus, announced that mortgage loan delinquency rates have fallen again for the seventh straight quarter. According toTransunion's report, mortgage loan delinquencies (ration of borrowers 60 or more days past due) is now at a national average high of 3.96 percent. This puts national mortgage delinquency rates up 54 percent over 2007 rates.

These record delinquency rates are sure to forecast the continued surge in home foreclosures, increasing housing inventory, and depressing housing prices.

Reports like these are likely to increase pressure on the US Treasury and Federal Reserve to consider the FDIC loan modification proposal and new recommendations to push mortgage interest rates down to 4.5 percent.

Keith Carson, a senior consultant in TranUnion's financial services group predicts that worsening economic conditions, a "deeper slide in consumer confidence," and lenders reluctance to extend credit will pushdelinquencies higher and push economic recovery into 2010.

"Our forecasting models predict that the national 60-day mortgage delinquency rate among mortgage borrowers will continue in the fourth quarter of 2008 and through 2009, with the 2008 delinquency rates ending at 4.66 percent and 2009 rates possibly reaching 7 percent or greater."

Numbers like these certainly suggest their will continue to be a need for government mortgage loan refinance assistance and perhaps and accelerated national mortgage loan modification program.