The Foreclosure Report

Storm Related Delinqencies Pile Up

The Time-Picayune reports on delinquencies in the storm-torn gulf. "Almost 123,000 borrowers in Louisiana and Mississippi, most of whom took advantage of delayed payment plans in the weeks after Hurricane Katrina, were behind on their mortgage payments during the last quarter of 2005, a banker survey released Tuesday showed."

"The percentage of mortgages in the two Gulf Coast states that were 30 or more days past due remained significantly higher than either state had reported in recent times, yet fewer of those mortgages were being turned over for foreclosure than in the past, according to the Mortgage Bankers Association survey."

"The percentage of Louisiana loans past due 30 or more days past due rose to 24.6 percent in the third quarter, which ended one month after the storm hit, but by the fourth quarter some borrowers had resumed payments and the delinquency rate dropped to 20.8 percent."

"A similar pattern developed in Mississippi. In the third quarter of 2005, 17.4 percent of all mortgages were delinquent. That number dropped to 16.9 percent in the fourth quarter. Between the two states, 76,000 mortgages were considered 'seriously delinquent,' 90 days or more past du, in the final quarter of 2005. During nondisaster times, seriously delinquent loans would be subject to foreclosure."

"'Given the numbers, some number of delinquent loans will end in foreclosure,' Jay Brinkmann said. But 'in the immediate aftermath, you don't want to hold foreclosure over their heads because it would exacerbate economic development' problems."

"The delinquency numbers in Louisiana were substantially higher for those holding Federal Housing Administration loans or subprime mortgages. In Louisiana, 33.9 percent of subprime loans and 31.8 percent of FHA loans were at least 30 days past due at year's end."

posted by Ben Jones @ 10:50 AM