Q3 2009 Mortgage Delinquency Data
As more and more economic data is released, more and more, we are beginning to realize how severe our current foreclosure situation truly seems to be. The news media seems to want us to believe that the worst is behind is in the foreclosure crisis, but the reality paints a picture which is quite different.
The Mortgage Bankers Association (MBAA) recently released the Q3 2009 statistics about mortgage delinquency which revealed some truly alarming statistics which blew a lot of minds.
14.32% of all mortgages in the nation are in default (at least 30 days behind in payment) and of those, 4.38% are actually in foreclosure process where they have been served a Notice of Default. These numbers are the highest they have ever been since this organization kept track of these types of numbers. I REPEAT: 14.32% OF ALL MORTGAGES IN THE NATION IS IN DEFAULT!
And we all know what is causing these historic default activities: unemployment. Unemployment was at 10.2% while underemployment was at 17.5% for October. Unemployment is up while housing values are dropping, creating the perfect storm for foreclosures. Look at all of the categories listed above, in every single loan category MBAA tracked, 10% or more of said loans are in default. These are astronomical statistics, they had never seen numbers like that before.
The numbers for states like California will be even worse that these because we were at 12.3%. We must address the unemployment issue if we are to get out from underneath this 800 lb. gorilla sitting on our shoulders.
The real face of the recently unemployed
http://www.latimes.com/business/la-fi-economy5-2009sep05,0,3045652.story
The interesting part of the article for me was not about unemployment rising from 9.4% to 9.7% in July, but the part about the new face of the laid off employee.
“During the previous two recessions, in 1990-91 and 2001, people in their mid-40s to mid-50s continued to show employment gains as younger workers felt the brunt of the cutbacks. But since the current downturn began in December 2007, employment in the 45-to-54 age group has fallen by more than 1.2 million, according to the Labor Department.”
The trend is troubling because that prime earning age group of 45-54 are will represent a high number of homeowners who will be unable to make their mortgage payments and will quickly fall into default status. A study I read revealed most American households are unable to survive longer than 2 months if there is disruption in the income.
Unemployed workers have a difficult time getting another well paying job in 2 months……
