The delinquency rate for mortgages on one-to-four-unit residential properties increased to a seasonally adjusted rate of 3.62% of all loans outstanding at the end of the third quarter, according to new data from the Mortgage Bankers Association (MBA).
The third quarter delinquency rate was up 25 basis points from the second quarter and up 17 basis points from one year earlier. The percentage of loans on which foreclosure actions were started in the third quarter rose by 1 basis point to 0.14%.
“The national mortgage delinquency rate increased in the third quarter from the record survey low reached in the second quarter of this year, with an uptick in delinquencies across all loan types – conventional, FHA, and VA,” said Marina Walsh, MBA’s vice president of industry analysis. “The increase was driven entirely by a rise in earliest-stage delinquencies – those 30-days and 60-days past due. Later-stage delinquencies – those 90 days or more past due – declined to the lowest level since the first quarter of 2020. The decline in later-stage delinquencies, along with a foreclosure starts rate of 0.14% – which is well below the historical quarterly average of 0.40% – suggest that distressed homeowners may be utilizing available loss mitigation options that prevent a foreclosure start. Additionally, accumulated home equity may also be enabling some homeowners to sell their homes well before foreclosure becomes a possibility.”
