Another Rise in FHA Default Rates

In its latest report to HUD, the Federal Housing Administration disclosed that its default rate (loans more than 90 days delinquent) increased to 9.12% as of December 2009 vs. 6.82% in the prior year. More specifically, 531,671 of the 5.8 million loans insured by the FHA were in default, a staggering 66% year-over-year increase. As expected, Florida led the pack, with the state comprising 16 of top 25 most delinquent MSAs. Michigan had 4 cities in the top 25 and New Jersey had 3. The MSA with the highest default rate was Punta Gorda FL, with nearly 23% of its FHA-insured mortages at least 90 days or more in arrears.