The Analysis section of the release reads "In its first quarter analysis, TransUnion reported a potential positive sign in mortgage delinquency rate trends. For the first time since the recession began at the end of 2007, the quarter-to-quarter growth rate for national mortgage delinquency showed a decrease," said FJ Guarrera, vice president of TransUnion's financial services division. "Now, with the release of second quarter results, we see even more deceleration in mortgage delinquency, an indication that the mortgage market is beginning to stabilize." "There are several complementary economic statistics at the national level to support this guarded optimism, such as the increase in consumer confidence in the second quarter. As for the labor market, although unemployment had continued to rise through the second quarter, July figures for unemployment insurance were lower than expected. Furthermore, recent figures from the government show the unemployment rate actually dipping to 9.4 percent nationally in July. These encouraging economic signs, coupled with a decrease in the rate of mortgage delinquency growth, suggest that we may have seen the worst of the recession. This is particularly noteworthy, in that delinquency statistics are generally lagging indicators of the economic environment," continued Guarrera.
Frankly, I find TransUnion's rosy views comical. First, unemployment only fell to 9.4% in July due to nearly 500,000 being removed from the unemployment figures not because they found a job, but because they UNEMPLOYED TOO LONG! Also, there is no way that the mortgage loan delinquencies have turned a corner. With unemployment continuing to rise, increasing numbers of homeowners owing more than their homes are worth (i.e. underwater homeowners) and the wave of ARM mortgages coming due in May 2010 you can absolutely bank on increasing foreclosures and short sales. There is just no way around it. The bottom is something we have yet to see.