It has been nine months since late payments on home loans have increased, and junior lien improved after spiking.
In their monthly accounting of consumer loan defaults, Standard & Poor’s Ratings Services and Experian reported a 3.16 percent first-mortgage default rate during August. A month earlier, the default rate was 3.24 percent, while delinquency was more than a third better than August 2009.
The last time first mortgage delinquency increased was in December 2009, when it reached 4.76 percent.
Data for the reports are extracted from Experian’s consumer credit database of around $11 trillion in outstanding loans sourced from 11,500 lenders.
Second-mortgage defaults fell to 2.39 percent after surging 36 basis points to 2.77 percent in July. Like its first-lien counterpart, the second-mortgage rate improved by more than one-third from a year ago.
The composite S&P/Experian consumer credit default index, which also reflects defaults on bank cards and auto loans, was 3.32 percent.
Delinquency in Los Angeles improved 12 percent from July to 4.04 percent and was 36 percent lower than a year ago.
David M. Blitzer, managing director and chairman of S&P’s index committee, noted that the improvements “echo other consumer credit trends which show declines in consumer debt levels following the 2007-2009 financial crisis for most types of loans.”
