Posts Tagged ‘default’

Foreclosure Activity Hits Post-Recession Low in April

Posted on June 08, 2017 by Laura Lam

ATTOM Data Solutions released its April 2017 U.S. Foreclosure Market data, which shows foreclosure filings – default notices, scheduled auctions and bank repossessions – were reported on 77,049 U.S. properties in April, down 7% from the previous month and down 23% from a year ago to the lowest level since November 2005. “Foreclosure activity continued to search for a new post-recession floor in April thanks in large part to the above-par performance of mortgages originated in the past 7 years,” said Daren Blomquist, senior vice president at ATTOM Data Solutions. “Meanwhile we are seeing an elevated share of repeat foreclosures…

Bank Card Default Rate Increases, Auto Loan Defaults Down

Posted on May 15, 2017 by Laura Lam

The S&P/Experian Consumer Credit Default Indices, a comprehensive measure of changes in consumer credit defaults, shows the composite rate unchanged from last month at 0.94% in March. The bank card default rate recorded a 3.31% default rate, up 9 basis points from February. Auto loan defaults came in at 1.00%, down 5 basis points from the previous month. The first mortgage default rate came in at 0.75%, up one basis point from February and reaching a one-year high. The 5 major cities showed mixed results in March with two higher and three lower default rates. New York had the largest…

Millennials’ Debt Load Could Weigh Down Economy

Posted on May 09, 2017 by Laura Lam

Millennials — 21 to 34-year-olds — hold an estimated $1.1 trillion of the country’s $3.6 trillion in consumer debt, according to UBS, as rising student and auto loans outweigh a drop in mortgages.  All that rising debt is coming with rising default risks. A UBS evidence lab survey found that 52% of people worried about defaulting on any loan over the next 12 months were in the 21 to 34 age group. That’s not good news considering those same individuals are meant to be the largest source of spending on big-ticket purchase items like houses and cars over the next year.  There is already…

Foreclosures Continue Descent but Some Cities Still Struggle

Posted on May 03, 2017 by Laura Lam

ATTOM Data Solutions recently released its Q1 and March 2017 U.S. Foreclosure Market Report, which shows first quarter foreclosure activity was below pre-recession levels nationwide and in 102 out of 216 metropolitan statistical areas (47%). Nationwide the report shows foreclosure filings – default notices, scheduled auctions and bank repossessions – were reported on 234,508 U.S. properties in the first quarter of 2017, down 11% from the previous quarter and down 19% from a year ago to the lowest level since Q3 2006. The first-quarter foreclosure activity total was 16% below the pre-recession average of 278,912 properties with foreclosure filings each quarter…

Subprime Student Loans Resemble Pre-Crisis Mortgage Loans

Posted on April 28, 2017 by Laura Lam

Millions of U.S. parents have taken out loans from the government to help their children pay for college … now a crushing bill is coming due.  Hundreds of thousands have tumbled into delinquency and default. In the process, many have delayed retirement, put off health expenses and lost portions of Social Security checks and tax refunds to their lender, the federal government. Student loans made through parents come from an Education Department program called Parent Plus, which has loans outstanding to more than 3 million Americans. These loan applications ask almost nothing about its borrowers’ incomes, existing debts, savings, credit…

Over 40% Students Don’t Make School Loan Payments

Posted on April 26, 2017 by Laura Lam

More than 40% of Americans who borrowed from the government’s main student-loan program aren’t making payments or are behind on more than $200 billion owed, raising worries that millions of them may never repay.  The new figures represent the fallout of a decade-long borrowing boom as record numbers of students enrolled in trade schools, universities and graduate schools. While most have since left school and joined the workforce, 43% of the roughly 22 million Americans with federal student loans weren’t making payments as of Jan. 1, according to a quarterly snapshot of the Education Department’s $1.2 trillion student-loan portfolio. About 1…

Consumer Defaults Predicted to Rise in 2017

Posted on April 24, 2017 by Laura Lam

About 17% of all U.S. consumers are likely to default on a loan payment over the next year, according to a recent report from UBS. More interesting, perhaps, is who these defaulters are.  The UBS Evidence Lab reports that the group’s profile is “middle and upper income, younger, male, urban, and concentrated in the coastal regions.” The UBS researchers also found evidence that defaults on auto loans are likely to spread to more non-prime defaults on credit cards and personal loans. About 16% of all auto loans outstanding are subprime, amounting to $179 billion out of total auto loans of…

Auto Loan Defaults Not Likely to Cause Next Bubble

Posted on April 10, 2017 by Laura Lam

An increase in the delinquency of risky auto loans probably won’t send the U.S. economy into the doldrums the way the mortgage loan crisis did in 2008-09, but it will likely pinch car sales.  Borrowers are falling behind on most subprime car loans, but deep subprime consumers – those with credit scores below 550 – have deteriorated fastest, according to a report by Morgan Stanley. Just like mortgages, many of those loans have been packaged into bonds, “securitized” in Wall Street parlance, and sold across the world to investors searching for yields in the wake of the financial crisis. Car…

Bank Card and Mortgage Defaults Tick Upward

Posted on April 06, 2017 by Laura Lam

Data from the recent S&P/Experian Consumer Credit Default Indices report shows the composite rate up two basis points from last month at 0.94% in February. The bank card default rate recorded a 3.22% default rate, up one basis point from January. Auto loan defaults came in at 1.05%, down one basis point from the previous month. The first mortgage default rate came in at 0.74%, up two basis points from January. The 5 major cities showed mixed results in February with two higher default rates, two lower, and one unchanged. Dallas had the largest increase, reporting 0.83%, up eight basis…

Auto Finance Fraud Could Hit $6 Billion

Posted on March 30, 2017 by Laura Lam

PointPredictive, a provider of fraud solutions to banks and finance companies, details a new analysis confirming that auto financing fraud risk has been rising for several years, but remains hidden in credit losses.  PointPredictive estimates the annual value of auto finance originations that contain some element of misrepresentation may be as high as $6 billion in 2017, which is twice as much as 2016 estimates. The analysis revealed that auto financing fraud can be broken into 3 separate categories: Known fraud that finance companies have been able to identify. Hidden fraud that ends up misclassified as early or first payment…