Green shits...errr..shoots. I said exactly 5 weeks ago mortgage defaults would ramp up dramatically, and on prime loans. It's begun. This says two very disturbing things: The U.S. can't help, and probably has hurt, the mortgage default rate, with its counterproductive mortgage delinquency therapy program, and a much wider mass of Americans than ever before are in the crosshairs of the financial disease. This is some of the worst news on the economy to manifest itself in a long, long time. http://www.bloomberg.com/apps/news?pid=20601087&sid=amq8v.M.ak60 Delinquencies Double on Least-Risky Mortgages, U.S. Report Says Share | Email | Print | A A A By Margaret Chadbourn June 30 (Bloomberg) -- Delinquency rates on the least risky mortgages more than doubled in the first quarter from a year earlier as U.S. efforts to help homeowners failed to keep pace with job losses that pushed more borrowers toward foreclosure. Prime mortgages 60 days or more past due climbed to 2.9 percent of such loans through March 31 from 1.1 percent at the same point in 2008, the Office of the Comptroller of the Currency and the Office of Thrift Supervision said today in a report. First-time foreclosure filings on the loans rose 22 percent from the fourth quarter, the report said. âIâm very concerned about the rise in delinquent mortgages and foreclosure actions,â Comptroller of the Currency John Dugan said in a statement released with the quarterly report. President Barack Obamaâs plan to create âsustainable, payment- reducing modifications is a positive step that should show significant benefits in the coming months,â Dugan said. Obamaâs program, unveiled Feb. 18, aims to help as many as 4 million borrowers by modifying loans and calls for Fannie Mae and Freddie Mac to refinance mortgages for as many as 5 million borrowers who owe more than their homes are worth. Foreclosure filings surpassed 300,000 for a third straight month in May, according to RealtyTrac Inc., and the U.S. economy has shed about 6 million jobs since the recession began in 2007. Serious delinquencies on prime loans, which account for two-thirds of all U.S. mortgages, rose to 661,914 in the first quarter from 250,986 a year earlier, according to the report. Overall, mortgages 60 days or more past due rose 88 percent from last year, the report said. Mortgages modified to help struggling borrowers stay in their homes fail within nine months more than half the time, the report said. About 53 percent of mortgages modified in the first quarter of 2008 were 30 or more days delinquent after six months, and increased to a 63 percent default rate after a year. âRising serious delinquencies are a leading indicator of increased foreclosure actions in the future,â the agencies said. To contact the reporter on this story: Margaret Chadbourn in Washington at mchadbourn@bloomberg.net. Last Updated: June 30, 2009 10:00 EDT
Not only are thing deteriorating as stated above, but 60 Minutes did an expose a number of months back, that outlined that a new, fresh wave of rate adjustments (yes, even with rates as low as they are) are slated to hit the market in early 2010, on adjustable rate mortgages. This rate adjustment effecting millions of homeowners, can cause another tidal wave of delinquencies, already on top of what we have currently. Things are not looking good around town...
Take it to your (insolvent) bank that the real numbers are at least an ass crack and a half worse than officially reported ones. And we're talking plumber's crack, too.