Mortgage Delinquency Rate Drops to 20-year Low
Jul 10th, 2019 @ 1:14 PM by Amber Nelson
American homeowners are staying current on their mortgage loans better today than they have for the past 20 years, according to data from CoreLogic.
The national delinquency rate – the percentage of home loans that are past due by 30 days or more – fell to 3.6% in April. That is down 4.3% from one year ago and the lowest rate since 1999. The mortgage delinquency rate has been dropping on a yearly basis for the last 16 straight months.
“Thanks to a 50-year low in unemployment, rising home prices and responsible underwriting, the U.S. overall delinquency rate is the lowest in more than 20 years,” said Frank Nothaft, CoreLogic chief economist.
Early-stage delinquencies – those between 30 and 59 days late – slipped down to a rate if 1.7% from 1.8% the year before. The mortgage share that were past due by 60 to 89 days in April was 0.6%, the same as the previous year. Serious delinquencies – loans late by 90 days or more and including foreclosures – fell dropped to 1.3% from 1.9% in April 2018. That is the lowest share since August 2005.
Even with the overall improvements, there are some areas around the country that are struggling. “A number of metros that suffered a natural disaster or economic decline contradict this national trend,” Nothaft said. “For example, in the wake of the 2018 California Camp Fire, the serious delinquency rate in the Chico, California, metro area this April was 21% higher than one year ago.”
There were also mortgage delinquency increases in Florida, Georgia and North Carolina because of the effects of recent hurricanes. And with flooding in the Midwest, several more states could see delinquency rates rise in the near future.
“The U.S. has experienced 16 consecutive months of falling overall delinquency rates, but it has not been a steady decline across all areas of the country,” said Frank Martell, CoreLogic president and CEO. “Recent flooding in the Midwest could elevate delinquency rates in hard-hit areas, similar to what we see after a hurricane.”
Amber Nelson is a seasoned mortgage industry writer and a regular contributor to Loan.com and Mortgage101.com.