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Serious delinquencies of U.S. prime-rated residential mortgages rose in June from May, the 37th-straight month of sequential gains, though subprime and Alt-A loans extended a recent trend of declines, according to Fitch Ratings.
While noting the continued drops are “noteworthy,” the portion of borrowers who had been current in the prior month but fell behind–or roll rate–remains elevated.
“The persistently high roll rates indicate that the delinquency declines are more a reflection of increased property liquidation and ongoing loan-modification activity than of widespread improvement in mortgage-payment performance,” said Fitch’s Vincent Barberio.
Mortgage delinquencies have shown signs of plateau in recent months, with a number of measures showing their first declines since 2007, when the housing bubble began to lose air.
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