BizJournals Portfolio
Home >   Business Views, Opinions and Blogs >   Business Blogs >   Market Movers >  

Mortgage Delinquency Rises At Fastest Rate In 17 Years

Market Movers

by Felix Salmon
Main
Bush's FHA Band-Aid   Special Situation: Lehman Subprime Unit Shutdown

Recent Blog Posts

Links

Aug 22 2007 12:00am EDT

Mortgage Delinquency Rises at Fastest Rate in 17 Years

Yves Smith of Naked Capitalism submits:

Bloomberg informs us that the FDIC has released data showing that mortgages over 90 days past rose over 36% from second quarter last year to second quarter this year, the biggest increase since 1991.

This report is troubling in two regards. First, the last big spike occurred in the 1991 recession, which was a nasty, though short, affair. We aren't in a recession. Mortgage delinquencies and defaults generally track unemployment, yet unemployment levels are not high by historical standards. What is going to happen if/when the economy slows? We are only in the early phases of a credit contraction.

Second, as was mentioned in passing in a Wall Street Journal story today and has been treated in greater depth elsewhere, many ARM mortgages had low initial interest rates and will reset, with the heaviest concentration in 2008.

blog comments powered by Disqus
 
Feedbackpowered byPowered by WebUltra
U.S. Uncovered
Rich City, Poor City

Which cities were still making money during the recession and which went under? Our analysis.

Don't Mess With Texas Small Biz

Best U.S. metro areas that are most conducive to the creation and development of small businesses.

A Sporting Chance

A look at the places best primed economically to host a major-league sports franchise.

spotlight on

Multimedia

Wealth Central

The Great Recession certainly took its toll on cities across the United States. But even with high unemployment rates and declining wages, some communities have done very well for themselves. View Interactive Feature