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Mortgage deliquency rate projected to inch--and I mean inch--downward in 2010
12/08/2009 2:30 pm EST
That’s the forecast from TransUnion, the big credit rating company, based on an analysis of credit trends over the last few months.
TransUnion isn’t talking about a big turnaround in the national trend in 2010. Just that mortgage delinquencies will peak in 2010 and then decline slightly.
The company projects that delinquencies will grow to 6.59% of all mortgages at the end of 2009 from 6.25% at the end of the third quarter. At 6.25% the third quarter delinquency rate was about three times the historical norm.
In 2010 the delinquency rate will fall to 6.39%, TransUnion projects.
Good news I guess. The 2010 rate will be higher than the third quarter 2009 rate that was already three times the normal historical level. But it will be down 0.2 percentage points from the end of 2009 peak.
Let’s hope the drop means that delinquencies will continue to fall and that they don’t get stuck at an elevated level after 2010.
The picture won’t be uniform, of course. TransUnion projects that 22 states will see a double-digit decrease in mortgage delinquencies in 2010. The biggest decreases will come in North Dakota (a 17.9% drop), Minnesota (a 15% drop) and Oklahoma (a 14.4% drop).
Five states, however, will actually see an increase in mortgage delinquencies in 2010: Florida (17.3% increase), Arizona (6.3% increase), California (0.9% increase), New York (0.4% increase) and Virginia (0.4% increase).
By the end of 2010 TransUnion projects that Florida will have the highest mortgage delinquency rate at 16.9%, almost three times the national average, followed closely by Nevada at 16.1%.
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