Even with unemployment and housing price levels remaining relatively stable, TransUnion reports that the number of homeowners who have missed their mortgage payments for 60 days or more increased during the third quarter of 2011. The increase was not expected, largely because predictive factors such as housing prices and unemployment did not deteriorate during the same quarter.

Some experts believe that the continued bad state of the economy in California and across the country is weighing very heavily on homeowners and consumers in general. The ongoing debt crises in Europe and in the U.S. are undermining consumer confidence to such a degree that many homeowners may not see the value in continuing to make their mortgage payments. Unfortunately, missing mortgage payments for 60 days or more is seen as an early sign of foreclosure, and a further increase in foreclosures would also be very bad for the economy.

The rise in delinquencies on mortgage payments was actually the first increase seen since the final quarter of 2009. Since then, the number of homeowners missing payments had decreased or at least remained stable. Many had hoped this stability represented a step in the right direction for the economy. The fact that delinquencies have increased may mean that things have taken a turn for the worse, or that the optimism over the 2010 and early 2011 numbers was misplaced.

San Diego foreclosure attorneys noted that another factor posited by some experts was that some adjustable-rate mortgages may be resetting to higher interest rates, causing more homeowners to face higher payments. With higher payments and no increases in income nor in home values, some homeowners may be giving up on paying the mortgage.

Source: USA Today "Mortgage payments show surprising rise in delinquencies" Nov. 8, 2011