About 123,000 behind on mortgage after Katrina
March 15, 2006
About 123,000 behind on mortgage after Katrina
The Associated Press
NEW ORLEANS — About 123,000 borrowers in Louisiana and Mississippi are behind on their mortgage payments, even though most took advantage of delayed payment plans in the weeks after Hurricane Katrina, according to a banking survey.
During the last quarter of 2005, the percentage of mortgages in the two Gulf Coast states that were 30 or more days past due were significantly higher than either state had reported in recent times, according to the Mortgage Bankers Association.
Yet, fewer of those mortgages were being turned over for foreclosure than in the past, according to the report.
“The foreclosure forbearance program is working,” said Jay Brinkmann, vice president of research and economics for the association.
In the days after Hurricane Katrina, most lenders began offering 90-day payment deferrals. But those delayed payments still counted as being delinquent.
The percentage of Louisiana loans past due 30 or more days past due rose to 24.6 percent in the third quarter, which ended one month after the storm hit. By the fourth quarter.
During the third and fourth quarters of 2004, 7.5 percent of all Louisiana mortgages were past due.
In the third quarter of 2005 in Mississippi, 17.4 percent of all mortgages were delinquent. That number dropped to 16.9 percent in the fourth quarter. During the third and fourth quarters of 2004, 9.2 percent of all Mississippi mortgages were past due.
Between the two states, 76,000 mortgages were 90 days or more past due, which would be subject to foreclosure during normal times.
Brinkmann said the high number of loans 90 or more days past due points to the need “to get a housing and economic development program funded and under way in Louisiana.” Brinkman said that Mississippi was further along on its economic recovery program.
In addition, the states should note the number of homeowners who are continuing to make their mortgage payments despite not being able to occupy their homes, Brinkmann said.
“These people are putting their faith and money into their expectations of a recovery along the Gulf Coast, and those expectations must be met,” he said.