by Tanta on 4/25/2007 02:42:00 PM
Wednesday, April 25, 2007
Freddie has a new press release out on severe delinquencies, showing stable numbers since year end (0.53%).
What was of interest is the above chart, comparing reported delinquency reasons in the period 2001-2005 versus 2006. Note that the delinquency reasons are reported by the mortgage servicer, as a contractual requirement. The "Other" category is actually an aggregation of a lot of miscellaneous reason codes, which range from property transfer in progress to borrower skipped to borrower incarcerated. As Freddie Mac notes,
"This analysis underscores the magnitude of difference between Freddie Mac's 0.53 severe delinquency rate and those in the subprime market," said Freddie Mac Chief Economist Frank Nothaft. "The drop in job and income related delinquencies reflect the growth we've seen in payroll jobs, excluding the manufacturing sector, but the uptick in late payments due to excessive debt is potentially troubling because it is independent of economic trends and suggests some borrowers are having a harder time handling their financial obligations than in past years."