This piece goes along with the post I did yesterday on how home lending is becoming more difficult to acquire. According to the S&P and the Experian credit data, more of the home owners out there are seeing their mortgages to be more manageable; in turn, lowering the amount of mortgage defaults for the 8th straight month. I mentioned in my post yesterday that lenders are more strict and more careful with the approval process when giving out a loan. This is because of all the defaults they have seen over the past couple years. They want to make sure they will not be losing money which is usually everyone's concern in any matter. However, because of the stricter policies, people are acquiring more suitable loans that fit their requirements as opposed to their desires. Now we are starting to see the reality of the situation which is that if the right loans are being given out to the right people they will be paid and maintained instead of defaulting. The default rates are now even seeing post recession lows according to S&P and Experian. In August, first mortgage rates dropped .52% from the same time last year and the second mortgage rates have seen a drop of .72% compared to the previous month.
"For the housing market, there are still a substantial number of loans outstanding that defaulted in the past and that segment of the market is still of concern," says David Blitzer, managing director and chairman of the index committee at Standard & Poor’s. "But for 2012, the drop in mortgage default rates is a good sign for the housing market and the consumer."
Some information acquired from: Housingwire
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