Floods, tornadoes, earthquakes, and hurricanes send homeowners and insurers scurrying. Should investors in mortgage securities take the hint?

No, according to a study by Duff & Phelps Credit Rating Co. Delinquency jumps after such disasters but then returns to normal.

For example, delinquency almost doubled after the Los Angeles-area earthquake of 1994 but has since returned to pre-earthquake levels.

"With a serious disaster, it takes several months for borrowers to evaluate and adapt to the shock," said Henry Hyssen, vice president of mortgage-backed securities at Duff & Phelps.

Foreclosures in the stricken area showed no ultimate increase, according to the study, because servicers gave homeowners extra time to catch up on mortgage payments.

Lenders often require homeowners to load up on insurance before approving a loan.

"No lender is going to allow that property to be unprotected," said a spokesman for the National Home Equity Mortgage Association.

One troublesome area is manufactured housing. Coverage for such property has become harder to get because many insurers discontinued such policies after incurring great losses in Hurricane Andrew.

In addition, zoning restricts manufactured homes to rural areas, which are often hit hardest by tornadoes.

The homes are built to withstand high winds, said Kami Watson of the Manufactured Housing Institute, but "no home is built to withstand 200- mile-an-hour winds."

Mr. Hyssen of Duff & Phelps said, however, that securities backed by loans on manufactured homes are still solid, because of the high insurance requirements already in place.

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