Most Home-Loan Delinquencies Kept Rising In July
Last update: 8/21/2008 2:55:11 PM
DOW JONES NEWSWIRES
Standard & Poor's said delinquencies of most home-related loans continued to climb in July, as the ratings agency said the 2006 and 2007 issuance years continued to perform poorly.
The agency released last month's results for residential mortgage-backed securities created in 2005 through 2007 from home-equity lines of credit, closed-end second liens, prime jumbo mortgages, Alt-A and subprime loans.
S&P said as of the July distribution date, delinquencies on subprime deals were 38% of current total pool balances for 2005 and 41.7% and 31.3% for 2006 and 2007, respectively. Those rates were up 2% to 7% compared with June.
For jumbo loans - those above $417,000 - delinquency rates were up 5.6% to 13% from June, with the biggest increase from the 2006 vintage. Delinquency rates also increased for Alt-A deals, led by those originating in 2007.
But delinquencies for other deals were mixed. For home-equity loans, the 2005 and 2006 vintages rose 3.1% and 0.9%, respectively, but fell 7% for 2007. Deals with closed-end second liens from 2005 and 2006 had delinquency rates fall 6% and 1%, but 2007 rose 1%.
Delinquency rates have been increasing for a host of home-related loans as home prices have fallen - sometimes below the outstanding loan amount - and homeowners have had less incentive to keep up with payments.
-By Lauren Pollock, Dow Jones Newswires; 201-938-5964; lauren.pollock@dowjones.com
(END) Dow Jones Newswires
August 21, 2008 14:55 ET (18:55 GMT) |
