While the quarterly rate of late payments on bank-owned home-equity loans moved lower, the performance of other housing-related assets has worsened.
Delinquency of at least 30 days on consumer installment loans that are owned by banks was 1.68 percent as of third quarter, according to the Composite Ratio.
The ratio, which reflects performance on eight types of closed-end consumer loans owned by banks including HELs, deteriorated by 12 basis points from the prior quarter.
Deterioration has been far more substantial versus the same-three months in 2016, when the Composite Ratio was 1.41 percent.
Details about bank delinquency were reported Tuesday by the American Bankers Association.
“The very modest increase in closed end loan delinquencies reflects a slow movement back toward more normal levels,” ABA Chief Economist James Chessen said in the report. “Jobs remain plentiful and incomes continue to rise, which has helped boost consumer confidence.”
ABA’s data indicate that
30-day delinquency on HELs was 2.42 percent, declining by 8 BPS from the second quarter. A 17-basis-point improvement in the HEL rate has been recorded from the third-quarter 2016.
At 1.08 percent, the 30-day rate on home-equity lines of credit inched up a basis point from three months earlier. But HELOC delinquency has fallen 8 BPS from a year earlier.
On property improvement loans, the 30-day rate jumped 13 BPS to 1.08 percent
and was 14 BPS worse than as of Sept. 30, 2016.
An 11-basis-point drop left mobile home loan delinquency at 4.97 percent — though the rate has soared 186 BPS since the third-quarter 2016.
Still, Chessen is optimistic about the performance.
“Home-related delinquencies continue to show overall improvement as the housing market gains strength,” he said. “With higher property values and greater home equity, people are well-positioned and motivated to ensure their loan payments remain current.”
