Commercial Mortgage Delinquencies Down in Q1

The first quarter of this year recorded low delinquency rates for commercial and multifamily mortgages, according to new data from the Mortgage Bankers Association (MBA).

Based on the unpaid principal balance of loans, the MBA determined delinquency rates among the major groups within this sector. Banks and thrifts (recording 90 or more days delinquent or in non-accrual) was a 0.73 percent delinquency rate that was unchanged from the fourth quarter of 2015, while life company portfolios (60 or more days delinquent) saw a 0.06 percent delinquency rate, an increase of 0.02 from the previous quarter. Commercial mortgage-backed securities (30 or more days delinquent or in REO) recorded a 3.93 percent delinquency rate, down 0.80 percentage points from the fourth quarter.

Among the government-sponsored enterprises, Fannie Mae (60 or more days delinquent) had 0.06 percent delinquency rate, down 0.01 percentage points from the fourth quarter, while Freddie Mac (60 or more days delinquent) had 0.04 percent rate, an increase of 0.02 percentage points from the previous quarter.

“Strong fundamentals and strong property prices, as well as still low interest rates, continue to support the performance of commercial and multifamily mortgages,” said Jamie Woodwell, MBA’s vice president of commercial real estate research. “A record decline in the volume of CMBS loans in foreclosure and REO brought a record decline in the delinquency rate for loans held in CMBS.  At the same time, delinquency rates remain extremely low for commercial and multifamily mortgages held by life insurance companies, Freddie Mac, Fannie Mae and banks and thrifts.”