The shrinking late payment rate is mostly due to fewer Federal Housing Administration loans relative to conventional loans. However, while overall the rate of late payments was lower, delinquency rates for specific loan types went up.
The first-quarter 2003 National Delinquency Survey, released by the Mortgage Bankers Association of America, also showed the percentage of loans in foreclosure increased slightly.
"Economic growth remained sluggish in the first quarter of 2003 as the number of jobs declined and personal bankruptcies continued to climb," said Doug Duncan, MBA's senior vice president and chief economist. "Nevertheless, the overall delinquency rate declined slightly by the end of the quarter, continuing the downward trend in overall delinquencies."
Duncan added that the second half of the year should bring economic growth and more jobs as the benefits of tax cuts and a strong refinance market kick in.