The quarterly rate of delinquency on home-equity loans that are owned by banks tumbled. Also dropping was the rate on home-secured credit lines.
Delinquency of at least 30 days on consumer loans that are owned by the nation’s banks came in at 1.41 percent as of the third quarter of this year.
The rate reflects performance on eight closed-end installment loan categories — including HELs, mobile-home loans and property improvement loans.
The composite rate
worsened by 6 basis points from three months earlier and was the same as previously reported for one year earlier.
Those metrics were delivered Tuesday by the
American Bankers Association in its Consumer Credit Delinquency Bulletin.
ABA reported that HEL delinquency was 2.59 percent, tumbling from 2.70 percent as of the second-quarter 2016. The improvement was even more significant versus 2.91 percent as of the third-quarter 2015.
“The three-year trend of declining home-equity delinquencies reflects a healthier housing market and rising home values,” ABA Chief Economist James Chessen stated in the report. “Borrowers are on much firmer financial footing than they were just a few years ago, and greater equity gives them additional motivation to stay current on their obligations.”
Thirty-day delinquency on home-equity lines of credit was 1.16 percent as of the end of September 2016, falling from 1.21 percent the prior quarter and 1.31 percent a year prior.
Mobile-home loans had a 3.11 percent 30-day rate. That was a 6-basis-point decline from the second quarter
and a 48-basis-point plunge from the third-quarter 2015.
On property-improvement loans, the rate of late payments worsened to 0.94 percent from 0.91 percent
three months previous and 0.87 percent one year previous.
