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Regional Spotlight: Mortgage Delinquencies for Connecticut Rise

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RISMEDIA, Dec. 7, 2007-The delinquency rate for mortgage loans on residential properties in Connecticut increased 60 basis points to 4.65% by the end of the third quarter of 2007 according to the Mortgage Bankers Association. The percentage of loans on which foreclosure was started during the quarter rose 12 basis points to 0.61%, while the percentage of loans in the foreclosure process at the end of the quarter rose 23 basis points to 1.32%, according to MBA’s National Delinquency Survey.

The state-level data quoted are not seasonally adjusted and normally peak during the fourth quarter and fall during the first quarter due to various seasonal factors. In the third quarter of 2007, all 50 states and DC saw an increase in delinquency rates.

The delinquency rate-which excludes loans already in foreclosure-for prime loans was 2.6%, up 53 basis points from the previous quarter, the rate for subprime loans was 15.58%, up 137 basis points from the previous quarter and the delinquency rates for FHA and VA loans were 11.69% and 7.11%, respectively-up 97 basis points for FHA loans and up 137 basis points for VA loans.

The delinquency rate for prime adjustable rate mortgage (ARM) loans increased 77 basis points and the rate for prime fixed rate mortgage (FRM) loans increased 47 basis points. The delinquency rate for the subprime adjustable rate mortgage loans increased 168 basis points, while the rate for subprime fixed rate mortgage loans increased 161 basis points.

The percentage of prime loans in foreclosure increased 10 basis points to 0.46%, the percentage of subprime loans in foreclosure increased 140 basis points to 7%, and the percentage of FHA loans in foreclosure decreased 6 basis points to 1.6%. The percentage of VA loans in foreclosure increased 16 basis points to 0.98%.

The Connecticut foreclosure inventory rate for prime adjustable rate mortgage loans increased 38 basis points, while the rate for prime fixed rate mortgage loans increased 3 basis points. The foreclosure inventory rate for subprime adjustable rate mortgage loans increased 227 basis points, while the rate for subprime fixed rate mortgage loans increased 12 basis points.

The new foreclosure rate for prime adjustable rate mortgage loans increased 16 basis points, while the rate for prime fixed rate mortgage loans increased 2 basis points. The new foreclosure rate for subprime adjustable rate mortgage loans increased 89 basis points, while the rate for subprime fixed rate mortgage loans increased 18 basis points.

Moreover, in the nation, Connecticut ranked 33 in delinquencies and 27 in foreclosure inventory. It is important to note that Connecticut has 17% nonprime borrowers (FHA and subprime); with a greater percentage of lower credit quality borrowers as with FHA and subprime, delinquencies will typically be higher.

On a national level, the delinquency rate on residential properties was 5.81% in the third quarter, up 75 basis points from the last quarter. The percentage of loans in which foreclosure was started during the quarter rose 19 basis points to 0.78%, while the percentage of loans in the foreclosure process at the end of the quarter rose 29 basis points to 1.69%.

© 2007 Mortgage Bankers Association (MBA). All rights reserved, except as explicitly granted.

Data are from a proprietary paid subscription service of MBA and are provided to the media as a courtesy, solely for use as background reference. No part of the data may be reproduced, stored in a retrieval system, transmitted or redistributed in any form or by any means, including electronic, mechanical, photocopying, recording or otherwise. Permission is granted to news media to reproduce limited data in text articles. Data may not be reproduced in tabular or graphical form without MBA’s prior written consent.

For more information, visit www.mortgagebankers.org.

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