Nearly 20% of sub prime mortgage holders were late on their payments in July 2007 according to a recent article by Stephen Bernard at the AP. And about 4% of the “Alt-A” mortgages, or mortgages above sub prime but below prime credit scores, had late payments as well. Here is the story:
NEW YORK – In all phases of the mortgage industry this week, from the people who make the loans to the people who insure them, the news was bad — and most of them expect it to get worse.
ADVERTISEMENTThings have gotten so tough, title insurer Stewart Information Services Corp. said it could not cut costs fast enough in August and September to keep up with the plummeting market. The company has already made “significant reductions” in its work force in October. Its insurance reimburses a homeowner or a lender if there is an error in the deed transferring property.
The market turned quickly for mortgage insurer MGIC Investment Corp. as well, as the rising delinquencies forced the company to pay out more in claims in the third quarter. MGIC said it expects to lose money through 2008 because it estimates it will pay billions in claims. MGIC Investment already posted a loss of $372.5 million in the third quarter.
And Countrywide Financial Corp., the nation’s largest mortgage lender, said it lost $1.2 billion over the summer, as the amount of money it set aside to cover losses from loans gone bad skyrocketed.