From DOW JONES NEWSWIRES
Standard & Poor’s said delinquencies of home-related loans climbed in January, with the rate surging in particular from December for home-equity lines of credit and prime-rated jumbo mortgages.
The agency released that month’s results for residential mortgage-backed securities created in 2005 through 2007 from the home-equity lines and jumbo mortgages as well as closed-end second liens, Alt-A and subprime loans.
Delinquency rates have been climbing for home-related loans as house prices have fallen – sometimes below the outstanding loan amount. As such, homeowners have had less incentive to keep up with payments.
The delinquency rates for jumbo loans – the minimum of which is $417,000 – delinquency rates remained relatively low overall, ranging from 7.2% to 7.8%. But they posted sizable increases from December, with the rate on 2005 loans soaring 26% in one month.
The increase on home-equity lines ranged from 9.2% to 15%, with overall delinquency rates of 12.5% to 17.5%.
By the way, I think jumbo minimums in California have been much higher for the last few years. I’ll look into, but I think it was lifted to ~$700k one or two years ago.
The word Jumbo first appears around the turn of the century. It is the name of a large elephant.