Skip to main content

Mortgage Default Rates on the Decline

Phil Hall
May 16, 2017
Consumer credit defaults on first and second mortgages dropped in April, according to data released by the S&P/Experian Consumer Credit Default Indices

Consumer credit defaults on first and second mortgages dropped in April, according to data released by the S&P/Experian Consumer Credit Default Indices.
 
The default rate on first mortgages fell from 0.75 percent in March to 0.69 percent in April; on a year-over-year basis, the default rate was unchanged. The second mortgage default rate fell from 0.57 percent in March to 0.51 percent in April, and it was also seven basis points lower than the April 2016 level.
 
The composite rate for consumer defaults dropped four basis points to April’s 0.90 percent level. However, the bank card default rate increased four basis points from March to 3.35 percent last month.
 
“Default rates on first mortgages are steady as home prices continue to rise in most parts of the country and sales of both new and existing homes increase,” said David M. Blitzer, managing director and chairman of the Index Committee at S&P Dow Jones Indices. “The Fed survey reported little change in either demand for mortgage loans or mortgage lending standards. The level of outstanding mortgage debt bottomed in the second quarter of 2014 and has been increasing steadily since then. After almost three years, outstanding mortgage debt is nine percent below the peak seen in the first quarter of 2008. Some analysts question if continuing increases in home prices presage a new housing bubble. Given conditions in the mortgage markets, this is not a current concern.”
 
Separately, the Mortgage Bankers Association reported that the delinquency rate for mortgage loans on one- to four-unit residential properties decreased to a seasonally adjusted rate of 4.71 percent of all loans outstanding at the end of the first quarter. The delinquency rate was down nine basis points from the previous quarter, and was six basis points lower than one year ago. The serious delinquency rate was 2.76 percent, a decrease of 37 basis points from last quarter, and a decrease of 53 basis points from last year.

 
Supreme Court Gives Biden Full Control Over Federal Housing Finance Agency

The U.S. Supreme Court gave President Joe Biden the authority to remove the head of the Federal Housing Finance Agency (FHFA) while dismissing claims from shareholders of Fannie Mae and Freddie Mac.

Industry News
Jun 23, 2021
Ocwen Financial To Acquire Reverse Mortgage Servicing Platform

Ocwen Financial Corporation's wholly-owned subsidiary, PHH Mortgage Corporation will acquire RMS' reverse mortgage servicing platform.

Industry News
Jun 18, 2021
UniteCT Emergency Rental Assistance Succeeds

Thanks to the successful launch of the UniteCT program, emergency rental assistance funds are helping Connecticut residents maintain housing.

Industry News
Jun 17, 2021
Angel Oak Mortgage Announces Initial Public Offering

Angel Oak Mortgage announced its initial public offering of 7,200,000 shares of its common stock at $19 per share.

Industry News
Jun 17, 2021
Mortgage Apps Rebound After Three Consecutive Weeks Of Declines

The Mortgage Bankers Association reported the first increase in mortgage applications after a three consecutive weeks on declines.

Industry News
Jun 17, 2021
CFPB New Rule Prevents Predatory Lending To Military Service Members

The CFPB stipulates its authority to examine supervised financial institutions for risk to active duty servicemembers and their dependents.

Industry News
Jun 16, 2021