Housing mortgage delinquencies have hit a 10 year low per data from CoreLogic, a California based data firm. Their most recent research shows that the average overall delinquency of home mortgages, as of May 2017, are down to 4.5 percent, a decline from 5.3 percent one year before (CoreLogic). This decline shows that American consumers are becoming increasingly more responsible in their treatment of their debt, and that banks and home mortgage lending groups have responded to the policies put in place after the housing collapse of 2008.
This data serves as a much-needed light in a time where Americans are overwhelmingly pessimistic about the future of the economy. Consumer sentiment has been relatively low, even though recent jobs reports have been strong, wages have been steadily growing and value of homes have increased.
Since 2008, trust in banking establishments have fallen to such low levels that more Americans than ever are foregoing home ownership and simply renting homes or apartments indefinitely. The problem with this is that it hinders borrowing ability. Without owning a house, or at least part of one, these Americans will have trouble getting loans from banks and building their credit scores. Buying a home has been an integral part of the American Dream because it is a little slice of the world a person can call their own. By only ever renting in one’s life, this security of owning real estate does not exist.
A major attributing factor to these low levels is that policies for housing mortgages have been extraordinarily tight. Only the top applicants are accepted as recipients. This rigidness is being combated by services that aggregate prices and cut costs by being paperless. Finally, the low interest rate environment Americans find themselves in makes it extremely beneficial to take out mortgages, given that a fixed rate mortgages will hold the current low levels.
At the end of the day Americans are all chasing their dreams, and owning a home is one of those dreams. Low delinquency rates on housing mortgages mean only good things for the economy.