More Md. prime borrowers behind on mortgages
The number of Maryland borrowers in trouble on their mortgages keeps rising -- particularly among homeowners who were supposed to be better credit risks. Some 60,000 prime borrowers were at least one payment behind during the first quarter of the year, up 90 percent from a year earlier, according to the Mortgage Bankers Association. That includes people on the brink of losing their homes.
Maryland had about 15,000 fewer delinquent subprime loans than prime. And their numbers rose 44 percent from a year ago, or half as fast as the prime mortgages in trouble.
Subprime borrowers are still much more likely to get behind than prime, mind you. Practically 40 percent of Maryland's subprime loans are past due, including those the lenders are trying to foreclose on. Yes, four in every 10.
For prime loans, it's 7.2 percent -- less than one in 10.
But no more than 3.5 percent of Maryland prime loans were behind in the late '90s, when the housing market was normal and jobs were plentiful. That's a big, big change. We'd have 30,000 fewer loans in various stages of delinquency if the ones in trouble still added up to 3.5 percent of the state's prime mortgages.
Lorraine Mirabella has a story today about the mortgage delinquencies. Economists are blaming the continued job losses.
As it happens, Maryland borrowers weren't struggling nearly as much during the early '80s double-dip recessions and the early '90s recession. Among all borrowers, delinquencies didn't top 5.5 percent between 1980 and 1982 or 1990 and 1991.
But delinquencies got pretty high -- peaking at nearly 8.5 percent -- in the late '90s and early part of this decade. And not because of the 2001 recession, either. Because FHA mortgages (government insured, and therefore not counted in either prime or subprime) were going bad at a frantic pace in Baltimore. That was during the spike in illegal flipping that landed people in jail for mortgage fraud.
Depressing to think that now it's worse. The share of all Maryland mortgages in trouble? More than 11 percent.