Late Arizona mortgage loans may fall in 2012

A credit-tracking firm predicts mortgage delinquencies will fall more sharply in Arizona next year than in any other state.

Credit bureau TransUnion expects the proportion of past-due Arizona home loans will drop nearly in half by the end of 2012, albeit from high levels.

At the end of the third quarter of 2011, 7.46 percent of residential mortgages in Arizona were 60 or more days past due, the third-highest level among the states behind those of Florida (14.08 percent) and Nevada (12.39 percent).

TransUnion predicts 7.15 percent of Arizona loans will be delinquent at the end of 2011, falling to 3.84 percent by the end of 2012.

Arizona's credit-card delinquencies are expected to change minimally, rising from 0.72 percent currently to 0.78 percent by the end of 2011 before easing to 0.75 percent at year-end 2012.

TransUnion randomly samples 27 million consumer-credit records on an anonymous basis to evaluate trends.

Its findings are based on various economic assumptions, including gross state product, consumer sentiment, unemployment rates and real-estate values. The company said its forecasts would change in the event of unanticipated shocks to the economy or real-estate market.

The predicted improvement in Arizona mortgages reflects several factors, including an expected stabilization of housing prices and much more conservative underwriting standards on new loans, said Charlie Wise, director of research in one of TransUnion's business units.

He said a high proportion of troubled loans in Arizona has been charged off by lenders.

Nationally, TransUnion expects mortgage delinquencies to decline from about 6 percent at the end of 2011 to about 5 percent at year-end 2012.

Favorable factors could include rising credit quality on new mortgages, improving consumer confidence and gains in gross domestic product.

After Arizona, TransUnion expects the biggest mortgage-delinquency improvements to occur in Wisconsin and Colorado. All told, the company predicts delinquencies will fall in 38 states and rise in the other 12, plus the District of Columbia.

Nationally, credit-card delinquencies, accounts 90 or more days past due, are expected to ease from 0.74 percent at the end of 2011 to 0.69 percent at the end of 2012.

"In today's uncertain economy, consumers have found that credit cards are among their most-valued assets due to the flexibility they provide," Steve Chaouki, a TransUnion vice president, said in a statement. "As a result, consumers have made a concerted effort to make on-time payments and maintain relatively low balances."

National credit-card debt per borrower stands at $4,762, down roughly $1,000 from mid-2009, according to TransUnion.

by Russ Wiles The Arizona Republic Dec. 8, 2011 05:48 PM





Late Arizona mortgage loans may fall in 2012