Mortgage Payments on Time in Hawaii

The citizens of the state of Hawaii know how to hustle. Amid a year of rising mortgage delinquencies, the people of the island state tried to come up with new and inventive ways to lower their mortgage. The number of delinquencies dropped from 2.07 in 2005 to 1.9 percent at the beginning of 2006. Nationally, the number of homeowners who fell behind in their payments rose to 4.7 percent, up from just under 4 percent in 2005.

A study conducted by the FDIC showed that lenders were writing more exotic loans to help homeowners reduce their monthly payment, or skip a payment all together. The majority of loans written in the last twelve months for Hawaiian homeowners were interest only or flexible, adjustable rate mortgages, which offer lower monthly payments in the early part of the loan. While there is a chance of borrowers overextending themselves, it allows the homeowner a little relief at the start of their mortgage. Accordingly, the default rate for subprime lending in Hawaii was at 5.8 percent, while the national average was 12.4.