Housing

This Is the City With the Worst Mortgage Problem

About 44% of American consumers have a mortgage. The combined debt from these mortgages has risen fast in recent years and now totals $10.3 trillion.

For many homeowners, this level is not a problem. The value of residential real estate has soared as home prices in many U.S. markets have risen by double-digit percentages year of year. Among the factors driving this increase are historically low interest rates. Another is that many middle-income and the highest-income families did not see a downturn in wages during the COVID-19-driven pandemic. People also have pushed real estate values up at extraordinary levels in some cities where people from the large coastal cities look for less expensive costs of living and better quality of life. Much of this relocation has been helped by the work from home economy.

According to CoreLogic Home Equity Report: “Even if loan modification or income recovery is unable to help delinquent homeowners become and remain current on their payments, the double-digit rise in home prices may help them avoid a distressed sale.”

A few cities have not shared the benefits of low mortgage defaults. According to the CoreLogic Loan Performance Insights for July, 4.2% of U.S. mortgages were delinquent for at least 30 days. This included those in foreclosure. The report also tracks those with “seriously delinquent” loans, which is defined as those with mortgages that are 90 days or more past due and also includes those in foreclosure.

The following 20 American cities have seriously delinquent mortgage rates of 4.8% or higher. Several are in Texas, including the city with the greatest problem, Odessa, Texas.

  • Odessa, Texas (7.9%)
  • Vineland, N.J. (7.2%)
  • Pine Bluff, Ark. (6.8%)
  • Laredo, Texas (6.6%)
  • Hinesville, Ga. (6.0%)
  • Lake Charles, La. (5.9%)
  • McAllen, Texas (5.8%)
  • Midland, Texas (5.8%)
  • East Stroudsburg, Pa. (5.6%)
  • Atlantic City, N.J. (5.5%)
  • Kahului, Hawaii (5.1%)
  • Brownsville, Texas (5.0%)
  • Poughkeepsie, N.Y. (5.0%)
  • Shreveport, La. (5.0%)
  • Watertown, N.Y. (5.0%)
  • New Orleans, La. (4.9%)
  • New York, N.Y. (4.9%)
  • Houma, La. (4.8%)
  • Lawton, Ok. (4.8%)
  • Miami, Fla. (4.8%)