Home foreclosures in Maine rise to new record of 2.36%

PORTLAND – The number of homes in foreclosure in Maine has risen to a record level.

According to a survey by the Mortgage Bankers Association, 2.36 percent of homes with mortgages in the state were in the process of being foreclosed on in the last three months of 2007. That’s the highest level since the MBA began keeping records in 1979.

By contrast, Maine’s foreclosure rate hit 1.6 percent during the last quarter of 1992, the Maine economy’s low point during the recession of the early 1990s.

The MBA survey also showed that mortgage delinquencies have reached a record level, with 5.88 percent of Maine home loans past due.

The new figures show that Maine, by most measures, is now faring worse than the national average during the nationwide mortgage crisis.

The MBA says Maine has the eighth-highest foreclosure rate in the nation, while its delinquency rate is the 23rd highest.

For subprime borrowers, delinquencies climbed 2.45 percentage points during the fourth quarter to 18.61 percent. At the same time, foreclosures on homes bought with subprime mortgages went up 2.09 percentage points to 11.26 percent.

Nonprime mortgages – either subprime or Federal Housing Administration-backed mortgages – account for 17 percent of all mortgages in the state, the MBA said.

Although foreclosures are expected to continue to increase at least through midyear, some homeowners with adjustable-rate mortgages may see some relief, said Anthony Armstrong, owner of Maine Home Mortgage Co. in Portland.

Many such mortgages are tied to an international interest rate known as LIBOR, he said. That rate was 5.34 percent a year ago, but this week fell to 3.01 percent.

The lower LIBOR rate means that people who are at the end of their teaser period should see less of a jump than they would have a year ago, Armstrong said.