Delinquency rates decreased for commercial and multifamily mortgage loans in the third quarter, according to the Mortgage Bankers Association’s (MBA) Commercial/Multifamily Delinquency Report. During the third quarter of 2012, the 60-plus day delinquency rate for commercial and multifamily mortgages held in life company portfolios decreased 0.03 percentage points to 0.12 percent. The 60-plus day delinquency rate for multifamily loans held or insured by Fannie Mae decreased 0.01 percentage points to 0.28 percent. The 90-plus day delinquency rate for loans held by FDIC-insured banks and thrifts decreased 0.18 percentage points to 2.93 percent. The 30-plus day delinquency rate for loans held in commercial mortgage-backed securities (CMBS) decreased 0.11 percentage points to 8.86 percent. The 60-plus day delinquency rate for multifamily loans held or insured by Freddie Mac remained the same at 0.27 percent.
“Commercial and multifamily mortgage delinquency rates for loans held by life companies, Fannie Mae and Freddie Mac all remain extremely low,” said Jamie Woodwell, MBA’s VP of commercial real estate research. “The delinquency rate on bank-held loans is at its lowest level since the beginning of 2009 and the delinquency rate for loans held in commercial mortgage-backed securities (CMBS) – while still elevated – continues to stabilize. If one removes the CMBS loans that are in foreclosure or REO, that delinquency rate is at its lowest since late 2009.”
The third quarter 2012 delinquency rate for commercial and multifamily mortgages held in life insurance company portfolios was 7.41 percentage points lower than the series high (7.53 percent, reached during the second quarter of 1992). The delinquency rate for multifamily loans held by Freddie Mac was 6.54 percentage points lower than the series high (6.81 percent, reached in the fourth quarter of 1992). The delinquency rate for multifamily loans held by Fannie Mae was 3.34 percentage points below the series high (3.62 percent, reached during the fourth quarter of 1991). The rate for commercial and multifamily mortgages held by banks and thrifts was 3.65 percentage points lower than the series high (6.58 percent, reached in the second quarter of 1991). The rate for loans held in CMBS was 0.16 percentage points below the series high (9.02 percent, reached in the second quarter of 2011).
Based on the unpaid principal balance (UPB) of loans, delinquency rates for each group at the end of the third quarter were as follows:
►Life company portfolios: 0.12 percent (60 or more delinquent);
►Freddie Mac: 0.27 percent (60 or more days delinquent);
►Fannie Mae: 0.28 percent (60 or more days delinquent);
►Banks and thrifts: 2.93 percent (90 or more days delinquent or in non-accrual);
►CMBS: 8.86 percent (30 or more days delinquent or in REO).
