While they are still higher than where they have been historically, mortgage delinquency rates moved lower for the fourth straight quarter last year, according to TransUnion, one of the nation's big three credit bureaus.
The firm reported that according to its data, the rate of mortgage holders more than 60 days late on their mortgage payments moved from 5.41% in the third quarter of 2012 to 5.19% in the fourth quarter. This was significantly below the 6.01% that the rate held in the fourth quarter of 2011.
“The national mortgage delinquency rate experienced its largest yearly decline since the conclusion of the recession, though we still remain far above normal levels,” said Tim Martin, group vice president of U.S. Housing in TransUnion’s financial services business unit.
“For the most part, newer vintage mortgage loans are not the reason for the stubbornly high delinquency rate. They are performing relatively well,” Martin said. “The elevated delinquency levels that we still are experiencing are a result of older vintage loans - borrowers who haven’t been making their payments for a rather long time that are still in the system, inflating the overall rate.”
During the height of the mortgage crisis, mortgage delinquencies rose 54% in 2007, 53% in 2008 and 50% in 2009, the bureau reported, adding that the subsequent decline has been a slow process with delinquency levels dropping 7% in 2010, 6% in 2011 and now falling 14% in 2012.