Rate updates from 2011 compiled to one page. Get a good overview of how the market for mortgage rates looked like back in 2011.

Mortgage Default Rates Resume Decline

Submitted on January 18, 2011

Mortgage default rates fell in December, resuming their downward trend after a brief rise in November, according to figures released today by Standard & Poor's and Experian.

Credit defaults fell across all four major categories of consumer borrowing, including first and second mortgages, credit cards and auto loans, on both a monthly and annual basis. Defaults on first mortgages fell to 2.93 percent of outstanding loans, while defaults on second mortgages fell to 1.74 percent.

The figures represent declines of 4.34 percent and 3.07 percent, respectively, from November's mortgage index readings of 3.05 percent and 1.80 percent.
"Nationally, consumers continue to gradually improve their financial condition," said David Blitzer, chair of the S&P Index Committee. "Separately, data from the Federal Reserve shows that bank card credit declined through November. Debt-service ratios, the proportion of disposable income that goes to paying debt, continues to decline."

Except for a brief upturn in November, default rates on first mortgages have been steadily declining since December 2009, while second mortgage defaults have been reduced by half over the past year. On an annual basis, the current monthly figures represent a decline of 38.57 percent in first mortgage defaults since December 2010 and 50.76 percent for second mortgages.

The credit card default rate fell to 6.73 percent in December, a 1.77 percent decline from November and a 17.68 percent improvement over one year ago. Auto loan defaults dropped to 1.68 percent, down 4.45 percent from November and an annual decline of 38.85 percent from December 2010.

Mortgage Rates Continue Decline

Submitted on March 3, 2011

Mortgage rates have fallen for a third consecutive week, despite signs of possible inflationary pressures that would normally act to push rates up.

The average interest rate on 30-year fixed rate mortgages fell to 4.87 percent this week, according to the weekly rate survey from Freddie Mac. That's down from 4.95 percent last week and almost two-tenths of a percentage point lower than the recent high of 5.05 percent reached three weeks ago.

Similar declines were reported on other loan types. The average interest rate on 15-year fixed-rate loans fell to 4.15 percent, down from 4.22 percent last week. Initial rates on 5-year Treasury indexed hybrid adjustable rate mortgages (ARMs) fell to 3.72 percent, down from 3.80 percent.

Compared to three weeks ago, the decline in 30-year rates means a buyer of a $200,000 home would save about $263 a year in mortgage interest, according to Frank Nothaft, Freddie Mac chief economist.
The decline in rates has occurred even as rising prices for gasoline and food have stirred concerns about inflationary pressures kicking in. Inflation typically means higher interest rates, because lenders need to charge more to stay ahead of the expected decline in the value of the money the loan will be repaid in.

However, Federal Reserve Chair Ben Bernancke has said he thinks the rise in gas prices will be only temporary and it not likely to pose a threat to the economy. Most observers do not expect the Federal Reserve to raise its own lending rates, which set the pattern for commercial lending rates, for a year or more.

Delinquency Rate Shows Big Drop

Submitted on February 8, 2011

Mortgage delinquencies fell by nearly 18 percent in 2010, pushed by a decline in new delinquencies, even as the number of homes going into foreclosure increased as well.

Mortgage data firm Lender Processing Services (LPS) reports that nearly 260,000 homes went into foreclosure in December, a nearly 11 percent annual increase over the 235,000 reported for December 2009. All told, 4.15 percent of all mortgages were in foreclosure at the end of 2010, up from 3.80 percent one year before.

The increase in homes in the foreclosure process was due in part to a slowdown in bank repossessions, as several lenders halted foreclosure proceedings late in the year to review foreclosure proceedings. Bank repossessions, which ranged between about 100,000-120,000 a month through the first nine months of 2010, fell by half from September to November, dropping to around 60,000 before increasing slightly in December.

Past-due loans made up 8.83 percent of all mortgages in December, down from 10.76 percent one year before. Seriously delinquent mortgages, those past due by 90 days or more, represented 4.00 percent of all loans, down from 5.49 percent in December 2009.

All told, the year ended with nearly 6.9 million mortgages in delinquent status, with 2.2 million of those in foreclosure, out of a total of nearly 53 million active mortgages in the U.S. market. About 1.2 million homes were repossessed by banks in 2010, according to LPS figures.

Meanwhile, refinance activity remained strong, with total mortgage originations in November approaching 750,000 loans, their highest level since July 2009. Mortgage originations have been trending upward throughout 2010 since bottoming out around 420,000 loans in February.

Government-backed mortgages currently account for about 95 percent of all home loans originated, with close to 70 percent being mortgages backed by Fannie Mae or Freddie Mac, and about a quarter of them Ginnie Mae loans, which include FHA and VA mortgages.

Half With Positive Equity Still Paying Above-Market Rates

Submitted on September 13, 2011

More than half of all homeowners with equity in their property are still paying above-market mortgage rates, despite a refinancing boom driven by historically low interest rates.

Currently, some 20 million homeowners with positive equity, 53 percent of all those considered "above water", are paying above-market mortgage interest rates, according to figures released today by the data and analytics firm CoreLogic. The figures apply only to active mortgages and not to homeowners who have paid off their loans.

Another 8 million who are "underwater" on their mortgages are also paying above market rates, or approximately three-quarters of those in negative equity.
The disparity worsens as negative equity increases. The survey found that over 40 percent of homeowners with negative-equity loan-to-value ratios of 125 percent or more were paying mortgage interest rates of 6 percent or greater, compared to only 17 percent of those in positive equity.

Although the inability of homeowners in negative equity to refinance their mortgages has received a great deal of attention, the figures show that those in positive equity appear to be having difficulty as well. It's not clear from the report why that is, although possible causes include minimal (yet positive) equity, loss of income, poor credit, uncertainty over the refinance process, low appraisals, or a combination of these or other factors.

The national share of homeowners in negative equity continued to decline in the second quarter of the year, according to the CoreLogic report, falling to 22.5 percent of all residential properties with mortgages, some 10.9 million, down from 22.7 percent in the first quarter. Another 2.4 million borrowers were classed as near-negative equity, with less than 5 percent positive equity in their property. Along with negative equity borrowers, this means that 27.5 percent of all homes with mortgages had less than 5 percent equity in the second quarter of 2011.

Published on August 7, 2009