Rate cuts won’t help ease the pain

The number of mortgages in arrears by 30 days or more increased slightly in the June quarter says Fitch ratings. The percentage of full-doc loan delinquencies rose from 1.31 per cent to 1.48 per cent while the proportion of low-doc loans in default also went up from 4.98 per cent to 5.28 per cent. Fitch said the numbers of people missing mortgage payments is expected to grow in the September and December quarters. Recent interest rate cuts may reduce the numbers of households on the brink of delinquency but would not reduce the number of borrowers already in trouble said Ben McCarthy from Fitch.

Source: The Australian Financial Review