Vegas mortgage delinquencies nowhere near peak of Great Recession

Some recent news stories about homeowners struggling to pay their mortgage have overstated the current scope of the problem.

There’s no denying that thousands of Nevadans are having trouble paying their mortgage for obvious reasons. Still, I was glad to see the Las Vegas Review-Journal’s July 21 story headlined “Southern Nevadans falling behind on mortgages amid pandemic” included some of the more balanced statistics we’ve been tracking at the Nevada Bankers Association.

As the R-J reported, mortgage delinquencies in Southern Nevada have increased since the pandemic, “but the share of local homeowners behind on their payments is still nowhere near the peak of the Great Recession a decade ago. Payments were at least 30 days late on 8.5 percent of Southern Nevada home loans in April, up more than double from 3.4 percent in March, housing tracker CoreLogic recently reported. Nationally, payments were at least 30 days late on 6.1 percent of mortgages, up from 3.6 percent in March.”

These statistics show we’re in much better shape than in early 2010, when the vast majority of local homeowners were upside down and nearly 25 percent of local mortgages were at least a month delinquent, compared with the peak of 12 percent nationally around that same time.

As we’ve been saying since this crisis started, the best thing for homeowners to do when having trouble paying their mortgage is to immediately contact their lender.

It’s also important to note that even after Nevada’s ban on evictions and foreclosures ends on Sept. 1, federal protections under the CARES Act will cover about 85 percent of all Nevadans with a mortgage, allowing up to 12 more months of deferred mortgage payments.

Armed with effective mortgage deferral and forbearance programs and lessons learned from the recession, Nevada banks have been doing an admirable job of working with their customers during this pandemic to keep them in their homes. The statistics reflect that.

That’s why our members urge state leaders to resist the temptation to enact counterproductive programs and regulatory obstacles that delay or detract from the ability of Nevada banks to do their job and continue working directly with their customers.

Phyllis Gurgevich is the president and CEO of the Nevada Bankers Association, the united voice of Nevada’s diverse banking industry.