Darren Waggoner

The delinquency rate for mortgage loans on one- to four-unit residential properties stood at 6.35% of all loans outstanding at the end of the first quarter of 2008 on a seasonally adjusted basis, up from 4.84% in the first quarter of 2007, the Mortgage Bankers Association reported Thursday, based on its National Delinquency Survey.

Lexicon United Inc., an Austin, Texas-based financial services holding company, said its Brazilian subsidiary that specializes in debt collections, ATN Capital e Participacoes Ltd. (ATN), has acquired a portfolio of distressed debt assets of Banco do Brasil SA with a face value of 498.7 million reals (or about U.S. $305 million) from Ativos S/A Securitizadora.

Over the coming months, "we expect banking institutions to continue to face deteriorating loan quality," Federal Reserve Vice Chairman Donald L. Kohn warned the Senate's Committee on Banking, Housing and Urban Affairs today, in a talk on the condition of the U.S. banking system.

U.S. consumer bankruptcy filings jumped 30.9% in May from the same month last year, the American Bankruptcy Institute reports today, based on data from the National Bankruptcy Research Center.

While the U.S. economy is weak, American Express Co. leaders are closely monitoring U.S. billings growth and the credit market overall.

The Discover U.S. Spending Monitor rose 1.4 points in May to 86.8 as consumers braced for higher spending in the wake of record gas and food prices. The card issuer released its report Wednesday.

Debt Settlement USA, a Phoenix-based debt settlement company, launched a Consumer Debt Index on Wednesday. It is a quarterly statistical analysis that measures the degree to which American consumers are suffering under an increasing burden of credit card, car payment, mortgage and other debt. In the first quarter of 2008, the index stood at 11.76, up 22% over the second quarter of 2007 when it was 9.60. This index is calculated based on a combination of the Consumer Price Index, consumer credit outstandings, mortgage delinquency rate and unsecured consumer loan delinquency rate. Since the second quarter of 2007, when the company began combining the aforementioned metrics, each index component has increased. For example, the mortgage delinquency rate soared by 67.7% and the consumer loan delinquency rate rose 18.6%. The level of outstanding consumer debt increased 4% and the Consumer Price Index grew from 2.08 to 2.12. However, the index's increases have softened since the June quarter of 2007. It rose 2.7% in the first quarter of 2008, after rising about 9% in the third and fourth quarters of 2007. "The Consumer Debt Index reflects an alarming trend for consumers who are trying to get out of debt. Clearly, people are increasingly unable to pay their credit card bills and mortgages," Debt Settlement President Jack Craven said in a statement. The CDI is calculated each quarter by adding the quarterly average of the U.S. Department of Commerce's monthly Consumer Price Index, the Federal Reserve's quarterly average of consumer credit outstandings, and the Fed's quarterly mortgage delinquency and unsecured consumer loan delinquency rates.

Finance companies held more than $2.06 trillion in outstanding receivables during March, virtually flat from what they held during February but up 1.7% from nearly $2.03 trillion in March 2007.

The Mortgage Bankers Association's Market Composite Index for the week ended May 30 was 502.3, down 15.3% on a seasonally adjusted basis from 593.3 one week earlier. The results were adjusted to account for the Memorial Day holiday.

Franklin Credit Management Corp., a New York City-based specialty consumer finance company that primarily services and resolves performing, re-performing and non-performing residential mortgage loans, has signed an agreement to service loans for Bosco Credit LLC.

Bankruptcy filings in the federal courts for the 12-month period ending March 31, 2008, exceeded 900,000, according to statistics released Tuesday by the Administrative Office of the U.S. Courts.

Target Corp., had net write-offs in its credit card business of $161 million during the first quarter ended May 3, rising 62.6% from net write-offs of $99 million in the year-ago quarter, the retailer and issuer reported late Monday.

HSBC Holding plc's U.S. credit card business, which is broadly 50% prime and 50% nonprime, "continues to remain profitable, and we are now running our cards business

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Collection Industry insiders understand that their business supports the economy, helps lenders and retailers recoup costs and tames prices on goods for all of us, but John Q. Public only remembers that his third cousin's fishing buddy once heard from a rude collector.

For the quarter ended March 31, 10 credit unions with credit card portfolios of more than $1 million in outstanding balances sold portfolios totaling approximately $62 million in receivables, the Peterborough, N.H.-based consultancy says in a report released this week.

Home prices have plunged. Mortgage payments are set to jump. And now this: more and more homeowners are walking away from their mortgages, returning the keys to lenders rather than trying to keep up with rising payments on deteriorating assets.

The increased loss provisions were the main reason that reserves increased by $18.5 billion, or 18.1%, during the quarter, to $120.9 billion.

First-quarter charge-offs on card loans reached 4.83% of loans outstanding, up 76 basis points from 4.07% in the first quarter of 2007.

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