Mortgage Delinquency Rate Falls to 11-Year Low
Jun 13th, 2018 @ 4:19 PM by Amber Nelson
The rate of serious U.S. mortgage delinquencies – home loans that are more than 90 days past due – fell to 2.1% in March from 1.9% a year earlier. The current reading is at its lowest March level since 2007 when it fell to 1.5%.
Other delinquency rates were unchanged from a year ago. Early-stage delinquencies were unmoved at a rate of 1.7% in March while 60-89 days past due delinquencies held steady at a rate of 0.6%.
“Unemployment and lack of home equity are two factors that can lead to borrowers defaulting on their mortgages,” Frank Nothaft, chief economist for CoreLogic. “Unemployment is at the lowest level in 18 years, and for the first quarter, the CoreLogic Equity Report revealed record levels of home equity growth with equity per owner up $16,300 on average for the year ending March 2018.”
Total mortgage delinquencies – home loans in any stage of delinquency – fell to 4.3% in March, down from 4.8% in February and 4.4% the year before.
The foreclosure inventory rate also fell year-over-year, dropping 0.2% to 0.6% of all homes for sale, matching the 11-year low.
One factor that could potentially pull the foreclosure rate upward in the near future. “As we enter the summer, the risk of hurricane and wildfire damage to homes increases as does the risk of damage-related loan default,” said CoreLogic President and CEO Frank Martell. “Last year’s hurricanes and wildfires continue to affect today’s default rates. Serious delinquency rates are more than double what they were before last autumn’s hurricanes in Texas and Florida. The serious delinquency rates have also quadrupled in Puerto Rico.”
Amber Nelson is a seasoned mortgage industry writer and a regular contributor to Loan.com and Mortgage101.com.