Mortgage delinquencies jump, but foreclosures show a bright spot

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The endless barrage of numbers quantifying the housing crisis can numb the mind after awhile, but here are a few more to wrap your brain around:

• Home loans past due or in the foreclosure process in the U.S.: 1 in 10.
• Home loans past due or in foreclosure in California: 1 in 9.

The latest quarterly survey from the Mortgage Bankers Assn. shows the delinquency rate for all U.S. mortgages on one-to-four-unit residential properties at 6.99%, up from 5.59% a year earlier. California’s delinquency rate was about the same at 6.98%

California had more homes in the foreclosure process, however, according to the MBA: 3.9% of all homes, compared with 2.97% of homes nationally.

MBA economist Jay Brinkmann said the national trends still reflected intense problems with adjustable-rate subprime mortgages in California and Florida.

‘Prime and subprime ARMs continue to have the highest share of foreclosures, and California and Florida have about 54% and 41% of the prime and subprime ARM foreclosure starts, respectively. Until those two markets turn around, they will continue to drive the national numbers,” Brinkmann said.

If the report had a bright spot, it was that foreclosure starts are actually tapering off a bit in most categories, perhaps reflecting more efforts by lenders and loan servicers to modify loans. State data provided to The Times by the mortgage trade group showed that 92,711 homes in California entered foreclosure proceedings during the third quarter, down from 110,023 in the second quarter and about the same as 92,729 in the first quarter.

The MBA blamed the sagging economy and rising unemployment for worsening the crisis that began with the abandonment of traditional lending standards during the housing boom. The group said its survey covered more than 80% of the home loans in the country.

Update: Comments on this morning’s posting on mortgage delinquencies and foreclosures hitting a combined 10% questioned whether the delinquency figures might already include the foreclosure numbers.

I asked Mortgage Bankers Assn. economist Jay Brinkmann about double-counting and he said no -- loans in foreclosure are separate from delinquent loans. So the correct combined numbers during the third quarter, according to the MBA count, were 9.96% nationally and 10.88% in California.

The MBA is also sure it’s not double-counting foreclosures, Brinkmann said. (That can occur sometimes because of multiple filings at different stages of the foreclosure process.)

One comment also noted that Arnold Schwarzenegger had proposed a 90-day moratorium on foreclosure sales, which would mess up the numbers. The governor’s proposal was made in early November, well after the MBA survey period, which ended Sept. 30.

-- E. Scott Reckard