Delinquencies hit 5.12 % of all outstanding mortgages in the second quarter, up from 4.39 percent a year ago according to the Mortgage Bankers Association (MBA) quarterly survey. The loans actually entering foreclosure proceedings stood at 0.65 %, a rise from 0.58 % in the first three months – and the highest rate in the MBA’s 55-year history.
As stagnant home prices, more Americans are falling behind in their, 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. Homes entering the foreclosure process in Arizona, California, Florida and Nevada drove the national increase – the national foreclosure rate would have otherwise declined.
Many investors simply do not have the same level of interest in retaining their properties than do owner-occupiers who have, historically, always strived to keep their properties.