November 22, 2010 (Jeff Alan)

Credit Bureau giant TransUnion’s quarterly analysis of the mortgage industry is predicting a continuing drop in the national mortgage delinquency rate following another decrease in the third quarter of 2010. The delinquency rate dropped form 6.67 percent in Q2 2010 to 6.44 percent in Q3 2010 making it the largest quarterly decline since the fourth quarter of 2006.

TransUnion reports that the mortgage delinquency rate (the ratio of borrowers 60 or more days past due) is still higher than the 6.25 percent from the same quarter in 2009 but predicts that based on current trends, the rate will drop to 6.2 percent by the end of 2010. The delinquency rate was 6.89 percent at the end of 2009.

The mortgage delinquency rate is still far above the historical average of 1.5 percent – 2.0 percent.

Part of that prediction is based on recent data from two of the states where the mortgage delinquency problem has been the most significant: California and Arizona. The delinquency rate in California has fallen to 9.64 percent from 10.18 percent last year and in Arizona the delinquency rate has fallen to 9.96 percent from 10.37 percent last year.

Delinquency rates were highest in Nevada at 15.1%, followed by Florida at 14.6%. The lowest delinquency rates in the nation continued to be in North Dakota, at 1.52 percent, and South Dakota, at 2.24 percent.

The delinquency rate rose slightly in the third quarter in some Northeastern states, but TransUnion considers the increase too small to be a trend at this time.

Tags: transunion, delinquency rate, late mortgage payments