Mortgage Payments One Month Overdue Increase as U.S. Economic Growth Slows

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By Kathleen M. Howley


Aug. 26 (Bloomberg) -- The percentage of U.S. mortgages with one overdue payment rose in the second quarter, the first gain in early delinquencies in more than a year, as economic growth slowed and jobless claims rose.

Home loans overdue by a month rose to 3.51 percent, from 3.45 percent in the first quarter, according to a report today from the Washington-based Mortgage Bankers Association.

The gain suggests a slowing economy may increase foreclosures as mortgage holders lose their jobs, said Jay Brinkmann, chief economist of the group. New unemployment claims, measured as a monthly average, rose throughout the second quarter after falling in most of the prior period, according to data from the Labor Department in Washington.

“As we work through the bucket of troubled loans, we’re seeing an increase in a new crop of troubled loans,” Brinkmann said in an interview. “It’s primarily driven by the jobs market. It still takes a paycheck to make a mortgage payment.”

Unemployment averaged 9.7 percent during the second quarter, near the 10 percent rate of 2009’s final three months that was the highest since 1983, according to the Bureau of Labor Statistics. For the year, the rate may average 9.6 percent, based on the median estimate of economists in a Bloomberg survey. That would be a 27-year high. ..........(more)

The complete piece is at: http://noir.bloomberg.com/apps/news?pid=20601087&sid=aBipHCKpNKDE&pos=4

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1. Public Service Announcment: If you are behind on your mortgage,

Contact NACA (Neighborhood Assistance Corporation of America, a Non-Profit Advocacy HUD Certified Counseling agency) as soon as possible: http://www.naca.com/refinance/refinanceTenStep.jsp

No matter how bleak it looks, they can probably help.

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