by Wolf Richter
Wolf Street
On one side: land rush by a few hundred thousand home buyers. On the other: millions of homeowners with delinquent mortgages. Here are the metros by FHA delinquency rate. Two exceed 27%.
The Federal Housing Administration (FHA) prides itself in insuring subprime mortgages with, as it says, “low down payments,” “low closing costs,” and “easy credit qualifying” – all true. Of its active portfolio of 8 million mortgages that it insures, 17% were delinquent in July, the highest rate in FHA history. In many metros, the delinquency rates of FHA mortgages are above 20%; and in two metros, the delinquency rates exceed 27%.