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1st Mortgage Delinquency Tumbles

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A nice improvement was made in the rate of serious first-mortgage delinquency last month, though the second-mortgage rate remains higher than a year ago. Delinquency in Dallas sank.

The rate of 90-day delinquency on consumer credit was 0.93 percent in March. The rate reflects performance on automobile loans, bank cards, first mortgages and second mortgages.

Serious delinquency improved from the previous
month
, when the rate was 0.97 percent. An even bigger improvement was made from a year previous, when the rate was 1.05 percent.

The statistics were based on the S&P/Experian Consumer Credit Default Composite Index. The findings were derived from Experian’s database that includes $11 trillion in loans from 11,500 lenders.

Among five of the largest metropolitan statistical areas, Miami’s 1.15 percent rate on consumer credit was the highest
and 8 basis points worse than during February — the biggest month-over-month increase.

A 28-basis-point plunge in Dallas was the largest improvement, putting the rate at 0.75 percent — the lowest of the five MSAs.

On just first mortgages, the U.S. 90-day delinquency rate was 0.77 percent last month.

Serious first-mortgage delinquency declined from 0.84 percent a month earlier and 0.92 percent a year earlier.

At 0.59 percent as of March 2016, the second-mortgage 90-day rate was a single basis point lower than in the previous report.

Second-mortgage delinquency was worse, however, than 0.50 percent
as of March 2015.

“Large mortgage debts followed by rapidly rising defaults in all kinds of consumer credit were key causes of the financial crisis,” David M. Blitzer, managing director and chairman of the index committee at S&P Dow Jones Indices said in the report. “Conditions today are much improved; not only are defaults down, but outstanding mortgage balances were about 12 percent below the peak seen in the first quarter of 2008. Debt-service ratios are close to the record lows set in the last two years as well.”

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