L.A. County's Mortgage Default Rate Double Last May's

Discussion in 'Wall St. News' started by ByLoSellHi, Jul 8, 2009.

  1. All trends emanate from California, from fashion to 'clean' food to automotive designs to economics.

    It's trendy now to just ignore one's mortgage (actually, it's a combination of massive job losses and less stigma associated with deadbeat-itus that's causing this).

    That "backlog" of REOs I've so often spoken of is just beginning to wash over the country.

    Just wait until you get a look at August & September default rates.


    L.A. County's May default rate double last year

    The percentage of Los Angeles County mortgages delinquent by 90 days or more in May was nearly double the rate last year, First American CoreLogic reported today.

    May's 9.5% delinquency rate for L.A. County was up from 5% of mortgages late by 90 days or more in May 2008. First American bases its foreclosure analyses on public records.

    While the default rate has nearly doubled, the number of homes actually being sold at auction -- the final foreclosure stage -- has shrunk. In May, the L.A. County repossession rate was down to 1% of mortgages, from 1.1% a year ago. This discrepancy is the "foreclosure backlog" now looming over the housing market. It's caused by various government-mandated and voluntary foreclosure moratoriums, and possibly by lenders trying to manage the flow of repossessed homes entering the market.

    Nationally, First American reported 6.5% of mortgages were in default in May, up from 4% in May 2008. The national repossession rate was 0.7% in May, up from 0.6% in May 2007.

    -- Peter Y. Hong