MORTGAGE: Mortgages in arrears double in past year

Business Mortgages in arrears double over past year
Canwest News ServiceJune 24, 2009
The number of B.C. and Yukon residential mortgages in arrears has nearly doubled in the past year, and the numbers will likely keep climbing.

"It will continue to go higher in coming months. We're not through the recession, so we'll see further rises in arrears and defaults," said Helmut Pastrick, chief economist for Central 1 Credit Union.

Given the economic downturn and its subsequent impact on the housing market, "these numbers aren't surprising," Pastrick said Tuesday.

Arrears and defaults are expected to increase when people lose their jobs, he said. "If you are working, chances are you are not going to fall behind and if you do, you can usually renegotiate or come to terms with the lender, but if you lose your job that is even more difficult."

Job losses have become an increasing concern on Vancouver Island, where unemployment has been rising in sectors such as tourism and forestry.

As of the end of March, 0.29 per cent of residential mortgages, or 1,645 in total, were in arrears by three months or more in the B.C.-Yukon region, the Canadian Bankers Association said in a monthly report.

(Source: Vancouver Sun)