Study: More homeowners behind in payments

Mortgage loan delinquencies in the fourth quarter of 2008 increased for the eighth straight quarter as more homeowners fell further behind in their monthly payments, according to credit and information management company TransUnion.

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The percentage of borrowers 60 or more days past due reached 4.58 in the fourth quarter, up nearly 16 percent from the previous quarter and 53 percent from the same quarter in 2007.

The mortgage loan delinquency statistic is traditionally seen as a precursor to foreclosures.

"We think nationally they're going to approach the 8 percent neighborhood by the end of the year," said Keith Carson, a senior consultant in TransUnion's financial services group. "The research is showing that the largest contributor to foreclosures and delinquencies is the negative equity in the home. You can imagine that if a consumer there in Arizona owes more on a home than it's worth, there's a problem there."

Maricopa County's delinquency rate was 8.08 percent in the fourth quarter, up from 6.34 percent in the third quarter and 3.27 percent in fourth-quarter 2007. Arizona's rate was 6.93 percent, up from 5.49 percent and 3.08 percent.

"I think Arizona is probably going to be above the national average as we move forward," Carson said. "There's a number of states and Arizona is one of them that's been hit harder than the others."

Arizona was among three states showing the greatest percentage growth in delinquency from the previous quarter. Its delinquency rate rose 26.2 percent, while Montana's rose 24.5 percent and South Dakota's rose 23.9 percent.

The average national mortgage debt per borrower rose slightly to $192,789 from the previous quarter's $192,287. On a over-the-year basis, the fourth quarter represents a .74 percent increase compared to the fourth-quarter 2007 average of $191,370.

Loan delinquency is tied to people losing their jobs or having their wages reduced, said Jeff Underwood, certified mortgage professional with AmeriFirst Financial in Mesa.

"Unfortunately those numbers are going to most likely continue to go up unless this (federal) affordability and stability plan can actually do something," he said. "Housing is so tied to employment that until people are confident about their jobs and confident about spending money again, we're probably going to see those numbers rise even more."

Many people now are deciding whether to pay their mortgage based on how far upside down they are in their home, Underwood said.

"Psychologically ... people are making it more of a business decision, of 'Should I keep this house if it's $100,000 upside down or not?' and many people are siding with the 'It's not worth it to keep this house' side," he said. "That train of thought is going to cause the delinquency rates in Arizona to definitely skyrocket."