Consumer default data released Tuesday by ""Standard & Poor's"":http://www.standardandpoors.com and ""Experian"":http://www.experian.com show that overdue first and second mortgages dropped in April.
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The indices, developed jointly by the two companies' and calculated based on data extracted from Experian's consumer credit database of approximately $11 trillion in outstanding loans sourced from 11,500 lenders, put the default rate of first mortgages at 3.7 percent and the default rate for second mortgages at 2.5 percent.
[COLUMN_BREAK]Defaults in both loan groups fell by more than 6 percent compared to March. Overdue first mortgages were down 31 percent from the firms' reading in April 2009. Defaulted second mortgages fell 45 percent compared to a year ago.
""Consumer defaults continue to moderate in the key big ticket items of first and second mortgages,"" said David Blitzer, managing director and chairman of the index committee at S&P. ""In these areas, defaults bottomed out around the same time as the stock market in the first half of 2009.""
Wide variations in the default statistics of major U.S. cities were clearly evident in the S&P/Experian study. For example, Chicago saw just a 5.8 percent decline in consumer defaults over the past year, but head down to Miami, and defaults dropped a sharp 40.5 percent within the last 12 months.
""Regional variations in default rates are typical,"" Blitzer explained. ""The sharp decline in…Miami reflect[s] a somewhat more stable, though still weak, housing market as well as some overall economic improvements seen in recent months.""