Mortgage Delinquencies Rise With Increasing Interest Rates
SMH reports that Global Ratings Agency, Fitch has shown that they expect to see mortgage arrears to rise on the back of Christmas spending and three straight interest rate rises over the last few months. Home loan arrears of 30+ days increased across all borrower categories in the December 2009 period. Non-confirming loans and low doc loans were hardest hit with a 50% spike in arrears. Overall, mortgage arrears rose by 0.02% to a total 1.23 percent. Customers who took their loans out prior to the Global Financial Crisis may find it easier to meet projected 2010 interest rates as the standard variable rate was then up towards 9% in March 2008.
Simon Reibelt from Oasis Hone Loans Northern Beaches said that current home owners who were already experiencing mortgage stress should look to other lenders apart from mainstream funders for refinancing opportunities.