Changes in Outstanding Mortgages, Applications, and Hirings

Since the mortgage crisis began in 2008, Americans have suffered the ups and downs of a sometimes fickle and unforgiving market. Bouncing back has not been easy, and many speculate whether or not we have hit the proverbial “rock bottom”.  A leading indicator as to how things are actually going can be somewhat revealed by outstanding mortgage trends. Things to consider when looking ahead and hoping for improvement are the number of delinquent and defaulted home loans.

Delinquent mortgages are those which homeowners are at least 30 days, or one mortgage payment, past due. Although homes in this state are not yet in foreclosure, delinquencies are definitely a red flag.

A defaulted mortgage is when the homeowner has missed three or more loan payments, or is 90 days behind on the monthly mortgage. This is the stage where most foreclosures begin.

So, here we are, halfway through 2012, and how are we doing? According to the NY Federal Reserve, severely delinquent mortgages, credit card bills, and car loans have all been declining over the last two years. More encouraging news comes from the Home Buying Institute in an article stating that both mortgage defaults and delinquencies were both down in January 2012. Although foreclosure rates were up at the start of 2012, the overall delinquency rate dropped by 10%.

The states with the highest number of defaults and delinquencies remain FL, CA, NV, MS, IL, OH, and ME.

In June, Inside Mortgage Finance reported that while the rate of new mortgage originations was down, 2012’s first quarter showed an increase of 15.3% in loans insured by the VA, FHA, and USDA. The site went on to note that; “This was in direct contrast to the 8.2% drop in conventional conforming originations during that same period.”

So, could it be we are becoming more cautious and resourceful when it comes to our home financing strategies? If that is true, then perhaps a valuable lesson has been learned as a result of the 2008 mortgage crisis.

As for new mortgage originations, the pace of applications continues to remain strong. I spoke with my friend, Shaun Hamman at American Financial Resources, and he stated that AFR had one of their biggest months ever and interest in HARP refinancing is starting to pick up.

Mortgage hirings have also been strong with over 2,800 new hires reported in March according to government figured. U.S. Bureau of Labor Statistics reported jobs in the mortgage banking and brokerage sector rose from 264,800 full-time positions in February to 267,600 in March.

Traffic to our two primary interest rate research web sites, and, has been brisk although interest appears to have trailed off a bit the past few days as rates increased.  If you are interested in tracking mortgage rates and closing costs from some of the leading mortgage companies in the US, be sure to check out our sites online and follow us on twitter.

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