Delinquencies rise among less risky loans

NEW YORK, Aug. 4 (UPI) -- Delinquency rates on U.S. home mortgages are rising among those with good credit scores, industry analysts said.

Mortgage delinquencies appear to have peaked among the riskier group, so-called subprime mortgages. But delinquency rates jumped 400 percent from April 2007 to April 2008 to 12 percent among "alternative-A" mortgages, which are given to those with sound credit, The New York Times reported Monday.

In the same period, delinquencies among loans considered even safer, prime loans, doubled to 2.7 percent, the Times reported.

The less risky loans are a far larger group than the subprime market, analysts said.

"Subprime was the tip of the iceberg," Thomas Atteberry, president of First Pacific Advisors, told the Times.

"Prime will be far bigger in its impact," he said.

Many prime and Alt-A mortgages reset after five to seven years, at which point borrowers begin to pay principal and monthly payments rise as much as 50 percent, the Times reported.

"More delinquencies look like they are on the horizon because so few of them have reset," David Watts, an analyst with CreditSights told the Times.