Mortgage delinquencies hit record high as more prime loans fall behind

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Mortgage delinquencies in the second quarter hit the highest level since 1972, the Mortgage Bankers Assn. reports today. The home mortgage delinquency rate climbed to 9.24%, up slightly from the first quarter, which had been the previous record high.

Prime fixed-rate mortgages made up one-third of delinquencies, up from one-fifth a year earlier. The bankers group said rising delinquencies on prime mortgages are the result of rising unemployment.

The group defines delinquency as loans at least one payment past due. Lenders typically do not start foreclosure proceedings until multiple payments are missed.

The full release is here.

California’s 9.4% delinquency rate was slightly higher than the nation’s.

This week, First American CoreLogic reported 32% of mortgages in the nation were underwater, or greater than the value of the homes. In the Los Angeles area, which includes Orange County, 35% of homes had negative equity, First American said.

Barring an effective foreclosure remedy, which has yet to surface, these latest measures of distress suggest a steady stream of foreclosures will continue for many months.

-- Peter Y. Hong