Mortgage Foreclosures Rise, but Late Payments Ease

The percentage of mortgages in the foreclosure process climbed to another record high in the first three months of 2003 as some homeowners had trouble making ends meet amid economic hard times.

At the same time, fewer homeowners were behind on their mortgage payments, marking the third quarter in a row that has happened.

The Mortgage Bankers Assn. of America’s quarterly survey released Friday painted a mixed picture of how homeowners are handling their mortgage obligations. The survey covers more than 33 million mortgage loans.

In the January-March quarter, the percentage of home loans in the foreclosure process rose to a record high of 1.2%, surpassing the previous all-time quarterly high of 1.18% in the fourth quarter of 2002.

Meanwhile, the share of home loans that started the foreclosure process in the first quarter edged up to 0.37%, from 0.35% in the previous quarter.

The rise in foreclosures came as job losses mounted in the first three months of this year and as personal bankruptcies ran at record levels.

The economy grew at an anemic rate of 1.9% in the first quarter as war worries made consumers and businesses more cautious.

The survey also showed that the seasonally adjusted percentage of mortgage payments 30 or more days past due for all home loans dipped to 4.52% in the first quarter, down slightly from 4.53% in the fourth quarter of 2002.

The delinquency rate does not include loans that are in the process of foreclosure.