US mortgage delinquencies set record

Among US homeowners with mortgages,7.58 pct were at least 30 days late on payments.

High US unemployment keeps pushing up the rate of mortgage delinquencies,which could in turn drive personal bankruptcies and home foreclosures,monthly data from the Equifax Inc credit bureau showed on Monday.

Among US homeowners with mortgages,a record 7.58 per cent were at least 30 days late on payments in August,up from 7.32 per cent in July,according to the data obtained exclusively by Reuters.

August marked the fourth consecutive monthly increase in delinquencies,and the report showed an accelerating pace. By comparison,4.89 per cent of mortgages were 30 days past due in August 2008,while in August 2007,the rate was 3.44 per cent,Equifax data showed.

The rate of subprime mortgage delinquencies now tops 41 per cent,up from about 39 per cent in each of the prior five months.

The results,which correlate with consumer bankruptcy filings,suggest US homeowners remain under financial stress despite signs of improving sentiment and fundamentals in the US housing market.

August bankruptcy filings were up 32 per cent from a year earlier,compared with a 35 per cent year-over-year increase in July.

Still,while more Americans were late with mortgage payments,they are keeping up with other bills. The proportion of credit card accounts at least 60 days past due was down in August for the third straight month,while subprime card delinquencies also fell.

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That improvement in delinquency rates partly reflects risk-aversion among issuers,which have cut the number of cards by 82 million,or 19 per cent,over the past year,while slashing credit limits by 721 billion,to about 3.6 trillion.

The number of new cards being issued is down even more dramatically. In June,2.6 million new cards were issued,compared with 4.7 million a year earlier.

Lenders are increasingly targeting consumers with high credit scores,Equifax found. While in 2007,about one in five new cards went to people with a credit score above 760,such consumers account for two in five new cards in 2009. Equifax found similar trends in auto loans.

8220;The data from August further confirms that we8217;re witnessing a dramatic change in consumer habits,8221; said Dann Adams,president of Equifax8217;s Consumer Information Solutions group.

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Total consumer debt is down more than 300 billion,or almost 3 per cent,from its peak in September 2008,Adams said,while the savings rate is nearing 5 per cent,8221;a level we haven8217;t seen in years.8221;