WASHINGTON — Home foreclosures soared to an all-time high in the final three months of 2007 and probably will keep rising, evidence of homeowners’ suffering and the economic danger from the meltdown.
The Mortgage Bankers Association said Thursday the proportion of all mortgages that slipped into foreclosure set a record, 0.83 percent, from October through December. In Colorado, 0.8 percent of loans went into foreclosure.
The previous national high, 0.78 percent, came in the July-through-September period.
“Clearly, it’s the worst it’s been,” said the association’s chief economist, Doug Duncan.
At the same time, more homeowners fell behind on their monthly payments. The delinquency rate, when payments are at least 30 days past due, for all mortgages climbed to 5.82 percent, the highest since 1985. In Colorado, the delinquency rate was 4.49 percent.
The national rate was 5.59 percent in the third quarter last year.
Homeowners with tarnished credit who have subprime adjustable-rate loans took the hardest hits. Foreclosures and late payments for these borrowers swelled to all-time highs, too, in the fourth quarter.
The portion of subprime adjustable-rate mortgages that entered the foreclosure process set a record, 5.29 percent. In Colorado, it was 4.6 percent. The previous national high, 4.72 percent, came only three months earlier.
Late payments soared to a record, 20.02 percent, compared with the mark of 18.81 percent from July through September. In Colorado, the rate is 14.85 percent.
The association’s quarterly snapshot of the mortgage market covers almost 46 million home loans.
“Mortgage credit quality is deteriorating fast,” said Mike Larson, a real-estate analyst at Weiss Research.
Already there are fears that the country is on the edge of a recession, if not in one now. The wave of foreclosures threatens to depress the housing market even more. The homes people are forced from add to the glut of unsold ones on the market. That means greater cutbacks by homebuilders, affecting economic activity.
Credit is harder to get, thwarting would-be buyers and aggravating problems in the housing market.
President Bush “understands that it’s traumatizing for people who are at risk of losing their home,” said press secretary Dana Perino.
“There is a concern that there’s a large amount of people who are facing foreclosure,” she said. “We do not believe that the American taxpayer should be bailing out lenders or borrowers, but what we do believe is that we can help try to bring them together.”
Denver Post staff writer Margaret Jackson contributed to this report.
