Thursday, May 19, 2011

New 30-day mortgage delinquencies fall in Colorado

The National Mortgage Bankers Association released its 2011 first quarter data today, and new 30-day mortgage delinquencies fell during the first quarter to the lowest level reached since the first quarter of 2008.

Related Post: Foreclosure inventory in Colorado falls to two-year low

2.17 percent of all mortgage loans surveyed were delinquent during the first quarter, falling from 2010's first quarter rate of 2.27. The percentage of loans that are 30-days delinquent has not been below 2.17 percent since the first quarter of 2008 when 2.03 percent of all mortgage loans were 30-days delinquent.

2011's first quarter 30-day delinquency rate is the lowest first quarter rate since 2008, and supports findings recently released by the Colorado Division of Housing showing that new foreclosure filings are presently trending downward.

In the graph below, the 30-day delinquency rate is broken out by year and by quarter. We can see that while the 30-day delinquency rate is the lowest it's been in three years, it is still above the rates reported during 2006, 2007 and 2008.

We also can note that the first quarter 30-day delinquency rate tends to be low compared to the other quarters, so we'd expect a drop from the fourth quarter, and we did see that. Nevertheless, the fact that this is the lowest 30-day delinquency rate in 12 quarters is significant and does support the conclusion that there are indeed fewer borrowers actually missing mortgage payments today compared to recent quarters.

The second graph shows a comparison between the Colorado 30-day delinquency rate and the national rate. We can see that the Colorado rate has been below the national rate in every year for which we have data. This isn't just true for the first quarter either. The Colorado 30-day delinquency rate is below the national rate in every quarter since at least as early as 2006.

During the first quarter of 2011, the national 30-day delinquency rate was 3.0, and it was 2.17 in Colorado. During the first quarter, Colorado had one of the lowest 30-day delinquency rates in the nation, with 41 states showing higher 30-day delinquency rates than Colorado.

Note: The 30-day delinquency rate is helpful in analyzing foreclosure trends since unresolved 30-day delinquencies eventually become foreclosure filings. If the number of 30-day delinquencies fall, then foreclosure filings are likely to fall in subsequent quarters as well, all thing being equal.