Year-end mortgage delinquency rates for the nation indicated some easing of pressure on U.S. homeowners, but warning signals remain in the Washington area.
A mortgage is considered delinquent if the homeowner is more than 60 days late with a payment. The United States League of Savings Associations reported that the delinquency rate rose from 0.78 percent of all outstanding mortgages in January 1980 to a high of 0.89 percent in November.
The December rate dropped almost impreceptibly to 0.86 percent, but U.S. League President William B. O'Connell called it "a positive sign." u
Some local lenders, however, are seeing a modest but steady rise in delinquencies, despite the league's optimism and the long-held view that metropolitian Washington is a virtually recession-proof housing market.
At Columbia Federal Savings & Loan Association, for example, the rate for 60-day delinquencies rose from 0.69 percent of their home mortgage portfolio in October 1980 to 0.83 percent in December. Columbia's delinquency rate for January 1981 continued to climb, to 0.91 percent.
The percentages represent nearly a one-third increase -- from 76 to 100 -- in the number of homeowners who have fallen behind 60 days or more in their mortgage payments to Columbia Federal.
"We are keeping a close watch on it," said Assistant Vice President Walter Hall. "When the rate hits 1 percent, we have to make some adjustments in our collection practices."
Even the smaller First Federal Savings and Loan Association of Washington, which will merge with Columbia Federal March 1, is seeing the trend to delinquencies. In January 1980, First Federal had only 10 mortgages that were delinquent. Last month it had 19 in a portfolio of 7,600 home mortgages.
First Federal's president, Dewitt Hartwell, said he is pleased with the low delinquency rate -- 0.25 percent -- although he is uneasy knowing there are nearly twice as many homeowners as last year who have fallen behind 60 days or more in their payments.
At National Savings & Trust the 60-day delinquency rate it still under 1 percent, "but we are experiencing slower receivables," said Assistant Vice President Robert Lowe.
Suburban state-chartered thrifts are watching the same trends. Although the 60-day delinquency rate at Citizens Savings and Loan Association of Maryland is at a low of 0.49 percent, (or 31 mortgages from a total of 6,266,) it is up appreciably from the 0.39 percent rate of a year ago. "It's not a bad rate," says Assistant Vice President Mike Melocik, "But we are aware of the warning signals around us."
One key signal for Melocik is the way loan payments are coming in. "Payments from our best customers have always come in on the first of the month like clockwork," he said. "Now I see some of them drifting in on the 10th or the 12th of the month."
Another problem encountered by Citizens and other S&Ls in the area is the integrity of the payment checks. Says Melocik, "We've had to return as many as 17 checks in one day. They were simply overdrawn."
The Federal Home Loan Bank Board reports the 60-day delinquency outstanding in home mortgages. In January 1980 the board said that 0.91 percent of the country's outstanding $476 billion in mortgage loans were delinquent. By December 1980 the rate was up to 1.15 percent of the outstanding $502.7 billion. That rate has held up for January 1981.
The local experience is different in terms of delinquencies as a percentage of total dollars outstanding. Both the District and Northern Virginia were reported by the board to have a delinquency rate of 0.54 percent in January 1980. The District ended the year with the same rate on a total of $4.5 billion in outstanding mortgages; Northern Virginia's rate rose only to 0.55 percent on $2.6 billion outstanding.
Suburban Maryland, however, began 1980 with a bank board rate of 0.70 percent; the rate rose to 1.66 percent in October but came down to 1.48 percent delinquencies among the area's $1.5 billion in mortgage loans.
Viewed through the percentage-of-total-dollars figure, the Washington metropolitan area does appear to be somewhat recession-proof. While there may be a rise in delinquencies, the relative value of the delinquent loans is declining, unlike the experiences in the country generally.