US Mortgage Deliquencies Rise in 2Q09

According to the Mortgage Bankers Association this morning, US mortgage delinquencies rose to a record rate of 9.24% of all loans outstanding. At the same time, the rate of foreclosures fell slightly to 1.36% from 1.37%.  What is interesting is that the rate of foreclosures actually fell for sub-prime ARMs, but rose for more traditional prime-fixed rate loans.  Given continued weakness in the labor market we will likely see delinquencies and foreclosures continue to rise for at least the remainder of this year, preventing any housing recovery from reaching its full potential.