Mortgage delinquency falls year-over-year

Nationally, the percentage of delinquent mortgages dropped 0.5 percent

Fewer homeowners are falling delinquent on mortgages, according to real estate analytics firm CoreLogic’s Loan Performance Insights Report.

Nationally the percentage of mortgages that were in some stage of delinquency dropped 0.5 percent year-over-year, from 5.6 percent in April 2016 to 4.8 percent in April 2017.

CoreLogic examined all stages of delinquency as well as transition rates, which indicate the percentage of mortgages moving from one stage of delinquency to the next.

As of April 2017, the national foreclosure inventory rate, which measures the share of mortgages in some stage of the foreclosure process, was 0.7 percent compared to 1 percent in April 2016. The serious delinquency rate, defined as 90 days or more past due including loans in foreclosure, saw the most dramatic drop, down to 2 percent from 2.6 percent in April 2016. The share of mortgages that were 60-89 days past due fell 0.1 percentage point, from 0.64 to 0.63.

But nationwide, the share of mortgages that transitioned from current to 30-days past due increased from 1 percent in 2016 to 1.2 percent in 2017, and early-stage delinquencies, defined as 30-59 days past due, increased to 2.2 percent from 2 percent. (By comparison, in January 2007, just before the start of the financial crisis, the current-to-30-day transition rate was 1.2 percent and peaked in November 2008 at 2 percent.)

Despite some delinquency increases, CoreLogic overall forecasted a positive outlook.

“Most major indicators of mortgage performance improved in April, showing that the market continues to benefit from improved economic growth and home price increases,” said Dr. Frank Nothaft, chief economist for CoreLogic. “While overall performance is improving, it reflects the older legacy pipeline of loans that continue to heal, especially in judicial states which typically take longer to clear out.”

Likewise, the CEO and president of CoreLogic, Frank Martell forecasted “delinquency rates will continue to fall for some time, but at a moderating pace.”

The Manchester-Nashua area followed along similar positive trend lines, with a 0.3 percentage points decrease in delinquent mortgages, dropping from 4.1 percent to 3.8 percent year-over-year. Mortgages in serious delinquency totaled 1.3 percent in April 2017, compared with 1.8 percent the year before. And the foreclosure inventory rate was 0.4 percent, down 0.1 percentage point.

Categories: Real Estate & Construction