Above: The yield on the 10-year Note
Posted on 09/06/2007 9:13:02 AM PDT by Hydroshock
NEW YORK (CNNMoney.com) -- The delinquency rate for mortgage borrowers spiked higher in the second quarter and the number of homes entering the foreclosure process hit a record high, according to a report released Thursday.
Deliquencies hit 5.12 percent of all outstanding mortgages, up from 4.39 percent a year ago, the Mortgage Bankers Association (MBA) said in a quarterly survey.
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Type Overall avgs
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Serious delinquencies, those 90 days or more late, jumped to 1.11 percent of all loans, from 0.98 percent in the first quarter.
The loans actually entering foreclosure proceedings stood at 0.65 percent, a rise from 0.58 percent in the first three months - and the highest rate in the MBA's 55-year history. (Latest home prices - 149 markets)
More Americans are falling behind in their mortgage payments as stagnant home prices, auto-industry weakness and climbing interest rates have taken a toll on housing affordability.
The survey revealed steady increases in all categories of delinquencies among mortgage borrowers but problems in subprime adjustable rate loans drove much of the increase.
(Excerpt) Read more at money.cnn.com ...
All right, interest rates, I understand.
But how do "stagnant prices" take a toll on affordability?
And what does "auto-industry weakness" have to do with it?
No bias here, folks! None at all!
“I just don’t understand how a couple making a combined income of 50K can not make the payments on a $750K starter home...
for later
As I publicly predicted the newws stories about homes enteringt foreclosures at the end of the summer are here.
What I did not predict was that the subprime meltdown would cause an elimination liquidity and kill off lending in the Alt A and even top tier credit end.
As I publicly predicted the newws stories about homes enteringt foreclosures at the end of the summer are here.
What I did not predict was that the subprime meltdown would cause an elimination liquidity and kill off lending in the Alt A and even top tier credit end.
Cry me a river. A bunch of people bought houses they couldn’t afford and I’m supposed to care? My man and I paid cash for ours and don’t owe anyone a cent. We could have bought a bigger house and gone into debt, but we didn’t. And I’ll be so mad if any of our tax dollars go to bailing out people who were greedy.
Above: The yield on the 10-year Note
“I just don’t understand how a couple making a combined income of 50K can not make the payments on a $750K starter home...”
Cause they have another 750k on MasterCard and 20k due the home shopping network? oh, and that set of Ginzu knives 5 payments of 89.99 they forgot.
Because the industry is finally pricing risk back into the market.
They are finally admitting that ‘ninja’ (aka: no income/no job/assets) loans are a really bad and risk-laden idea. And ARMs are for people who do not intend to stay in the house for a long period of time before selling; which isn’t a good idea in a market that is showing too high an inventory to move effectively.
So ARM rates will continue to move higher, and more of the serious buyers/owners will move to the very stable 30 year fixed. The market fixes itself. Until the Fed.gov interferes again, creating yet another imbalance.
America is in an unbelievable crisis and Hydroschock's article gives us the whole story: "foreclosure proceedings stood at 0.65 percent, a rise from 0.58 percent". Back in the good old days we'd only have a little more than a half of a foreclosure out of every 100 mortgages, but now it's soared to almost 2/3rds of a foreclosure.
Hmmm. Maybe this crisis is like I said at first -- not believable.
A lot of those ARMs have interest rates that were locked in 3/4 years ago when a 4.25 15 year fixed loans were available.
Now it's 3-4 years later and the ARM rates are reflecting the current interest rates instead of 2003-2004 time periods.
Anyone that had/bought a house that did not refinance / finance with fixed rates at the bottom of a 40 year low was an idiot.
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