More good news on the mortgage default rate front.
Both first and second mortgage defaults fell in May, according to the latest S&P/Experian Consumer Credit Default Indices released today.
The first mortgage default rate (I’m assuming 30 days late) was 2.09 percent in May, down from 2.16 percent in April and 3.45 percent a year ago.
Meanwhile, the second mortgage default rate dipped to 1.42 percent, down from 1.51 percent in April and 2.41 percent a year ago.
“While we might observe volatility from month-to-month, looking at default rates over the past few years it is easy to see that consumers have come a long way in fixing their balance sheets, ” said David M. Blitzer, Managing Director and Chairman of the Index Committee for S&P Indices, in a release.
“All indices show default rates below where they were this time last year, and more so if you look back to 2008/2009.”
Blitzer also noted that the Los Angeles housing market is doing better than the South Florida market, probably because the latter saw a ridiculous surge in inventory, mainly high rise condos that are largely vacant and worth nothing nowadays.
And we all know mortgage financing is harder to come by on a condo, further exacerbating the issue.