The national mortgage delinquency rate (the borrowers 60 or more days past due) decreased for the sixth consecutive quarter, dropping to 5.82% at the end of the second quarter in 2011. This information is reported by TransUnion and is part of its ongoing series of quarterly analyses of credit-active U.S. consumers and how they are managing credit related to mortgages, credit cards and auto loans.
Although mortgage delinquencies were expected to continue to drop, the Q2 2011 TransUnion data released today shows mortgage delinquency rates improved on a quarterly basis by 5.98%, more than any time since the recession officially ended two years ago.
“While relatively low home prices and high unemployment continue to exert upward pressure on delinquency rates, they are more than offset by the impact of more conservative lending policies reflecting consumers with higher credit scores,” said Tim Martin, group vice president of the U.S. Housing Market in TransUnion’s financial services business unit. “Not only are these consumers less likely to default if house prices continue to edge downward throughout the year, but their willingness to repay their debt obligations in the face of high unemployment rates is greater. It is because of these dynamics that lenders today take a much closer look at the borrower’s income history and overall debt situation than before the recession began in 2007.”
The part of the article that most effects our credit coaching clients is: “While relatively low home prices and high unemployment continue to exert upward pressure on delinquency rates, they are more than offset by the impact of more conservative lending policies reflecting consumers with higher credit scores.” Did you catch that? What this says is that banks have much more conservative lending policies and are looking to lend money to consumers with high credit scores. This is why it is imperative that you clean up your credit. Please contact us to get started on the road to great credit.
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If you are working on cleaning up your credit or building your credit in Utah, there is good news! “Our state is growing now, and as we look to the horizon, Utah’s growth prospects are truly bright,” Gov. Gary Herbert said in his State of the State speech on January 25, 2012, noting that is something not many governors can say.
