According to the L.A. Times, delinquences on mortgages will continue to rise and set records throughout 2009. This prediction came from a report by TransUnion, one of the three big U.S. credit reporting companies.
TransUnion also predicts some good news: even in California, one of the hardest hit states, they predict that the trend will start to reverse next year. Before the trend reverses, lenders need to work through huge numbers of backed-up loans and find a resolution for them.
So, for now, TransUnion expects the percentage of California home loans that are delinquent at least 60 days or are in foreclosure to increase to 14% by the end of the year. It was at 9.7% on June 30th.
California’s total economic picture is worse than the country as a whole. The CA unemployment rate was 11.9% compared to the national rate of 9.4%. So it’s not a surprise that the state is having more mortgage trouble than the rest of the country.
The predictions for the Inland Empire (San Bernardino County and Riverside County) are worse than for the rest of the State.
Although California will struggle for the rest of the year, the outlook for the rest of the country is brighter. States where foreclosures surged before those in California, are starting to see a downturn in distressed properties.