Mortgage Delinquency Rate Up in Q4 2017

The delinquency rate for mortgages on one- to four-unit residential properties increased to a seasonally adjusted rate of 5.17 percent of all loans outstanding at the end of the fourth quarter of 2017, according to new data from the Mortgage Bankers Association (MBA). The fourth quarter’s delinquency rate was up 29 basis points (bps) from the third quarter and was 37 basis points higher than the fourth quarter of 2016.

 

Foreclosure actions in the fourth quarter were started on 0.25 percent of loans, unchanged from the previous quarter and three bps lower on a year-over-year basis. The 30-day delinquency was down 15 bps in the fourth quarter as a result of government responses to the damage brought by Hurricanes Harvey, Irma and Maria.

 

“While the earliest-stage delinquency rate dropped, the 60-day and 90-day delinquency rates did increase in the fourth quarter of 2017,” said MBA Vice President of Industry Analysis Marina Walsh. “Despite the hurricanes and these quarter-over-quarter results, most states are seeing overall mortgage delinquency rates at lower levels than a year ago. Storm-related foreclosure moratoria continue to play a large factor in keeping foreclosure starts at bay, as the fourth quarter saw little movement in either foreclosure starts, or foreclosure inventory. As forbearance periods expire, an increase in the percent of loans in foreclosure is likely. We anticipate it will be several more quarters before the effects of the September hurricanes on the survey results dissipate, especially given extended forbearance periods.”

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