CoreLogic: Delinquency Rates Steady at 20-Year Low

Mike Sorohan msorohan@mba.org

August 13, 2019


Ahead of the Mortgage Bankers Association's National Delinquency Report release this morning, CoreLogic, Irvine, Calif., reported the May serious delinquency rate tied with April as the lowest for any month in nearly 14 years.

Additionally, the company's monthly Loan Insights Performance Report said no states posted an annual gain in its foreclosure, overall or serious delinquency rates, although some Midwest and Southeast regions hit hard by flooding or other storm damage posted relatively high delinquency rates.

The report showed nationally, 3.6% of mortgages were in some stage of delinquency (30 days or more past due, including those in foreclosure) in May, an 0.6 percentage point decline in the overall delinquency rate from a year ago, when it was 4.2%. This marks the second consecutive month the rate has been at its lowest point in more than 20 years.

CoreLogic reported as of May, the foreclosure inventory rate fell to 0.4%, down 0.1 percentage points from a year ago, which tied the prior six months as the lowest for any month since at least January 1999.

The report said the rate for early-stage delinquencies (30-59 days past due) fell to 1.7% in May, down from 1.8% a year ago. The share of mortgages 60-89 days past due in May was unchanged at 0.6from a year ago. The serious delinquency rate (90 days or more past due, including loans in foreclosure) fell to 1.3% in May, down from 1.8% a year ago. May's serious delinquency rate of 1.3% tied the April rate as the lowest for any month since August 2005.

CoreLogic also reported the share of mortgages that transitioned from current to 30 days past due was unchanged at 0.8% in May from a year ago. By comparison, in January 2007, just before the start of the financial crisis, the current-to-30-day transition rate was 1.2%, while it peaked in November 2008 at 2%.

"Growth in family income and home prices continues to support low delinquency rates," said CoreLogic Chief Economist Frank Nothaft. "Communities that experienced a rise in delinquencies are generally those that also suffered from natural disasters. Last year's hurricanes and wildfires, and this spring's severe flooding from heavy rainstorms and snowmelt have pushed delinquency rates higher in these impacted communities."

CoreLogic said the overall delinquency rate has fallen on a year-over-year basis for the past 17 consecutive months. In May, 20 of the country's metropolitan areas posted at least a small annual increase in overall delinquency, with some of the highest gains occurring in the Midwest and parts of the Southeast. Specifically, areas impacted by flooding this spring in Kentucky, Ohio, Illinois and Indiana have experienced an increase in delinquency rates.

"While the rest of the country experienced record-low mortgage delinquency rates again in May, the Midwest and parts of the Southeast are still experiencing higher rates as they recover from extreme weather," said Frank Martell, president and CEO of CoreLogic. "Areas in Kentucky and Ohio, which were hit particularly hard this spring with historic flooding, experienced some of the largest annual gains in the country."

MBA releases its quarterly National Delinquency Survey this morning at 10:00 a.m. ET. The NDS, conducted since 1953, covers 38 million loans on one- to four- unit residential properties, reported by more than 100 lenders, including mortgage bank, commercial banks and thrifts.

MBA Vice President of Industry Analysis Marina Walsh will provide insights into the report; MBA NewsLink and MBA Servicing NewsLink will provide coverage.

Share this article