Florida tops 2010 loan delinquency forecast

In an announcement received by Historic City News, we learned that Florida is expected to have the highest mortgage delinquency rate in the nation by the end of next year, at 16.86 percent — according to TransUnion’s annual credit forecast.

The Sunshine State will be followed closely by Nevada, at 16.14 percent.

States predicted to have the lowest mortgage delinquency rates are North Dakota (1.43 percent), South Dakota (2.2 percent) and Nebraska (2.35 percent).

The Chicago-based credit and information management company predicts the rate of those Floridians who fall 60 days or more behind on their mortgages will increase by more than 17 percent in 2010, from 14.37 percent at the beginning of the year to 16.86 percent by next December.

In the meantime, national mortgage loan delinquencies are predicted to drop nearly 3 percent by the end of next year, to 6.39 percent from an expected 6.56 percent at the end of this year. The projected decrease would end a trend that included unprecedented year-over-year increases of 54 percent between 2006 and 2007, 53 percent between 2007 and 2008 and 43 percent between 2008 and 2009, TransUnion noted.

“We believe the nation will see a turnaround in mortgage delinquencies in the coming year,” said Ezra Becker, director of consulting and strategy in TransUnion’s financial services group. “Tied directly to the anticipated unemployment rates and housing values, the decrease in delinquencies should be gradual.”

TransUnion also predicts Florida to be among those states with the highest 90-day credit card delinquency rate at the end of 2010, at 1.4 percent. Still, that is down slightly from 1.43 percent in the fourth quarter of this year.

Floridians and South Floridians appear to be getting a better grip on their credit card debt.

Both the state and the Miami-Fort Lauderdale-Pompano Beach metropolitan statistical area have seen greater drops in credit card debt than the rest of the nation, down $128 and $233, respectively, during 2009. The national decline has been just $117.

“Although we have seen over the last several quarters that credit card debt has been coming down in Florida, and even on a steeper curve in Miami, the credit card debt per borrow is much higher in the Miami MSA and in Florida than it is for the rest of the nation, noted FJ Guarrera, TransUnion’s vice president of financial services.

Floridian’s average debt in the third quarter was $6,361, while Miami’s average debt was $6,237. That’s significantly higher than the national average of $5,612.

“When these home values start to improve, and they will, we will see some of that credit card delinquency come down as well,” predicted Guarrera.