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Thanks for stopping by my Mortgage Statistics Blog...

If you're wondering what my top blog posts have been, here they are:

1. 19 Years of Mortgage Origination Data
2. A Century of Home Ownership Rates
3. Option Arm Resets 2009, 2010, 2011 and 2012
4. Wells Fargo Mortgage Delinquency Rates
5. Will the Mortgage Interest Deduction go away?
6. and Fannie Mae Delinquency Data

What else would you like to see?

Mortgage Rates Drop to below 4%

As the Wall Street Journal reports, Mortgage Rates have officially fallen below 4%. I must admit that I never thought that the mortgage rates would fall this low and have been somewhat surprised.  Crossing this level marks the lowest home loan rates ever (In the early 1900's people typically get 30 year loans---Not until the government started stepping into the system and working on securitizing the mortgages did the durations start climbing---And for the last 30 years the APY's have started falling.

In my opinion, these low rates have helped to keep home prices from falling further.  I still think that if rates start climbing up to 5% or 6% housing prices could come down further. So my advice is that if you currently own your home and have enough equity to refinance, you should consider refinancing.

Will the Mortgage Interest Tax Deduction Go Away?

Recently there have been some news stories about politicians who may be considering the abandonment of the mortgage interest deduction. This tax deduction has been around for decades and allows homeowners to itemize their mortgage interest on their primary residence, second house and even home equity loans from their income.

It's clearly a benefit for current home owners who are levered up, and for realtors--because this deduction helps to make homes more affordable, and hence results in higher selling prices on real estate. However, with governments spending much more money than they're currently bringing in I figure that political leaders will consider either doing away with mortgage interest deductions, or else setting up some rules that limit the perk---These limits could include income limits, or rule out the tax savings from mortgage interest on second homes or equity lines of credit.

One important question that home sellers and buyers should be asking themselves is--"Can this happen?" I think it can. The next important question will be, "What does that mean for future home prices?" Clearly, if you take away what is effectively a subsidy on buying home -- all else equal -- the future transaction prices will have to fall. This is one of many reasons why I think it might still pay to be a renter for a few more years and enjoy the flexibility and optionality that renting provides.

Wells Fargo's Mortgage Delinquency Rates and Foreclosures are Better than Average and Better than Bank of America

Wells Fargo Chairman and CEO John Stumpf recently presented at the Morgan Stanley investors conference. One of the more interesting charts he talked about was on slide #21 in which he shows the Deliquency rate and foreclosure rate of his bank versus his peers during the third quarter of 2010. Specifically:

• Wells Fargo - 6.1% Delinquent + 2.1% in foreclosure
• Citibank - 6.9% Delinquent and 2.6% of mortgages in foreclosure.
• JP Morgan Chase came in at 7.8% and 3.7% respectively
• Bank of America was the laggard of the bunch (Thanks to their countrywide acquisition) with a whopping 3.7% of loans in foreclosure and 10.6% seriously deliquent..
• You can click on the chart above for larger view of the data that Mr. Stumpf presented.

The CEO also showed a comparison during fiscal year 2010 for the charge-offs as a percentage of all loans for Wells Fargo and its peers. Citi took the most in charge-offs on debt (4.6%), followed by Bank of America (3.6%), JPM (3.4%), Wells (2.3%) and US Bank had the best performance with just 2.2% charged off.

Interestingly enough over the last 10 years, Citi was the worst and US Bank was the best.

Unemployment Rate versus Mortgage Delinquency Rate

The chart can be expanded by clicking on it. But one interesting thing to look at is comparing the delinquency rate on all Freddie Mac and Fannie Mae Mortgages (The bar charts -- which use the left axis) versus the unemployment rate during the last 5 years. It's not surprising that as people lose their jobs and/or become under-employed they have less ability to stay current on their monthly mortgage payments.

consequently, the seriously delinquency rate experienced by America's largest mortgage companies really spikes up. You can see that Fannie has experienced far more mortgages going bad than Freddie has---but neither one did good in 2010. Fortunately, things seemed to have plateaued for now---However, as the chart shows---if people start getting laid off again, I think another step up in charge-offs and non-performing loans could pester these GSA's.

(Unfortunately, it had been months since I pulled the unemployment data, and I couldn't readily find the monthly U-6 data for much of 2009 and 2010---If you happen to have it handy, feel free to leave it in the comments and hopefully I'll be able to update the chart in a future month).