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Mortgage delinquency falling

Rates on number of homes past due dip to lowest since 2008


The number of mortgages that were past due in the fourth quarter was at it's lowest since the end of 2008.

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CHICAGO -- There's a note of optimism in the air about the U.S. mortgage delinquency rate.

The number of mortgages that were past due in the fourth quarter was at its lowest level since the end of 2008 (excluding homes that are already in foreclosure.) Meanwhile, the number of U.S. mortgages that were one month late last quarter fell to its lowest level since the end of 2007, the Mortgage Bankers Association said Thursday.

In Ohio, the trade group said, the delinquency rate in the fourth quarter of 2010 fell to 9.76 percent, down a half of 1 percent from the previous quarter.

Nationally, however, the number of homes in foreclosure rose, thanks to delays tied to investigations of servicers' back-office procedures.

The percentage of total delinquencies on one to four-unit properties was 8.22 percent in the fourth quarter, compared with 9.13 percent in the third quarter and 9.47 percent in the final quarter of 2009.

In an even better sign, the percentage of loans at least 90 days past due and in the process of foreclosure fell to 8.57 percent nationally, down from 8.7 percent in the third quarter and 9.67 percent a year ago.

In part, the improvement may be tied to the tighter loan underwriting that has become a mainstay of the housing market since 2008. Most mortgages that fall into delinquency do so within the first three years.

"We simply have a better set of loans entering the peak of the natural default cycle and for that reason I think we're going to continue to see a decline in the delinquency rates," said Jay Brinkman, the mortgage bankers' chief economist.

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