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In the wake of Hurricanes Michael and Florence, lenders can expect a spike in mortgage delinquencies from Virginia to the Florida panhandle, Credit Union Times reported. Two studies released this week found mortgage delinquencies rose significantly this past summer in parts of Texas and Florida hit by hurricanes a year ago. “A decade after poorly underwritten mortgages triggered a housing market crash, it’s clear that the foreclosure risk associated with those problem mortgages has faded,” said Daren Blomquist, senior vice president at ATTOM Data Solutions. “The biggest foreclosure risk in today’s housing market comes from natural disaster events such as the twin hurricanes of a year ago,” he said. The ATTOM U.S. Foreclosure Market Report released on Thursday shows forecloses were started on 177,146 U.S. properties in the three months ending Sept. 30, down 6 percent from the previous quarter, down 8 percent from a year ago and reaching the lowest level since the fourth quarter of 2005. The number of starts was 36 percent below pre-recession average of 278,912 properties per quarter. Also the percentage of foreclosure starts tied to mortgages originated from 2004 to 2008 was 44 percent, down from about 75 percent in 2012.

Mortgage rates hit their highest level in more than seven years this week at nearly 5 percent, a level that could deter many home buyers and represents another setback for the slumping housing market, the Wall Street Journal reported. The average rate for a 30-year fixed-rate mortgage rose to 4.9 percent — the largest weekly jump in about two years — according to data released Thursday by mortgage-finance giant Freddie Mac. Lenders and real-estate agents say that, even now, all but the most qualified buyers making large down payments face borrowing rates of 5 percent. A 5 percent mortgage rate isn’t that high by historic standards. During much of the decade before the financial crisis, these rates hovered between 5 and 7 percent.

HSBC Holdings Plc will pay $765 million to settle allegations that it sold defective residential mortgage-backed securities, resolving one of the last remaining U.S. investigations stemming from the mortgage meltdown a decade ago, Bloomberg reported. The sum, announced yesterday by U.S. Attorney Bob Troyer in Colorado, is substantially lower than the billions paid by other banks to resolve misconduct linked to these toxic securities. London-based HSBC wasn’t a major player in the market. With Wells Fargo & Co.’s agreement in August to pay $2 billion and Royal Bank of Scotland Plc’s deal to pay $4.9 billion that same month, the U.S. Department of Justice is now near the end of its decade-long effort to extract penalties for the conduct that led to the financial crisis of 2008. The biggest settlements, struck in 2013 and 2014, called for JPMorgan Chase & Co. and Bank of America Corp. to pay $13 billion and $17 billion, respectively, to resolve their cases. Unlike prior mortgage-related settlements with the Obama administration, this one doesn’t impose consumer relief or payments to state or federal agencies. For example, Citigroup Inc.’s $7 billion settlement included payments of $2.5 billion to help consumers and $500 million to federal agencies and state governments.

Wells Fargo & Co. is planning its first post-crisis offering of bonds tied to U.S. home loans without government backing, Bloomberg reported. The $441 million non-agency bond will include top portions, which will be rated AAA, and the sale will be finalized next week. Wells Fargo Chief Executive Officer Tim Sloan hinted over a year ago that the lender planned to originate a non-agency securitized mortgage offering in the near future and help kick-start the market, which cratered in 2008. Wells Fargo was one of the top issuers of private-label residential mortgage-backed securities in the run-up to the financial crisis. More than $1 trillion of mortgage bonds without government backing were issued in 2005 and 2006 each, according to Sifma.