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Florida mortgage delinquencies rose in second quarter, especially for FHA loans

Nationally, FHA loans reached the highest delinquency rate since at least 1979.
(AP Photo/John Minchillo, File)
(AP Photo/John Minchillo, File) [ JOHN MINCHILLO | AP ]
Published Aug. 17, 2020

More homeowners in Florida and nationwide became delinquent on their mortgage payments in the second quarter compared to the first, according to the Mortgage Banker Association’s latest national delinquency survey.

In particular, the Federal Housing Administration loans used to help lower-income and first-time buyers afford a house saw a record-breaking spike. Nationally, the delinquency rate for such loans increased to about 15.7 percent — the highest percentage since the association starting measuring in 1979.

In Florida, that number was even higher, at 16.8 percent. The state saw one of the greatest increases between the first and second quarters in the nation, along with New Jersey, New York and Hawaii — all states with a prevalence of tourism and hospitality jobs. New Jersey had the highest delinquency rate on Federal Housing Administration loans, at just more than 20 percent.

By comparison, the national delinquency rate for conventional loans nationwide was 6.7 percent, according to the survey, which includes 39 million loans by about 100 lenders.

The delinquency rates include homeowners who have forbearance plans, which have become more available as lenders and the federal government have expanded options to delay payments for as long as a year for those who’ve lost income to the pandemic.

Mortgage delinquencies are directly related to unemployment, and Marina Walsh, vice president of industry analysis for the Mortgage Bankers Association, noted that the job market has been improving in the past few months.

However, that good news is “tempered by numerous uncertainties, including the ambiguous status of enhanced unemployment benefits and other stimulus measures, the recent surge in new COVID-19 cases, and the retrenchment from reopening in certain states,” she said in a statement.