Today CoreLogic released its Loan Performance Insight Report for June 2021, revealing that 4.4% of all mortgages in the U.S. were in some stage of delinquency that month. This represents a 2.7 percentage point decrease in delinquency compared to June 2020, when it was 7.1%. Despite the positive trend, overall delinquencies remain above the February 2020, pre-pandemic rate of 3.6%.
Early stage delinquencies (30 to 59 days past due) made up 1.1% of all mortgage loans in June 2021, down from 1.8% in June 2020. Adverse delinquency (60 to 89 days past due) made up 0.3% in June 2021, down from 1.8% a year ago. Serious delinquency (90 days or more past due, including loans in foreclosure) was at 3% in June, down from 3.4% last year. This marks the tenth consecutive month of declines, and the lowest serious delinquency rate since May 2020.
The foreclosure inventory rate — meaning, the share of mortgages in some stage of the foreclosure process — was 0.2% in June 2020, down from 0.3% in June 2020. This marks the lowest recorded foreclosure rate since CoreLogic began recording data in 1999. Meanwhile, the transition rate, the share of mortgages that transitioned from current to 30 days past due, was 0.6% in June, down from 1% in June 2020.
“The downward trend in delinquencies, especially serious cases, is very encouraging — and a testimony to the impact of the significant economic rebound over the past six months, as well as government stimuli, record-low mortgage rates and loan modification options,” said Frank Martell, president and CEO of CoreLogic. “Providing resources to homeowners experiencing distress to help educate them on available government and private-sector support will aide in shrinking delinquency and foreclosure rates even more over the remainder of this year.”
In June, the federal moratorium was extended through July 31 to provide homeowners with additional time to get their finances back on track. Now the foreclosure rate is at a new generational low. Despite this great fortune, the CoreLogic survey found that nearly half (43%) of respondents said they do not understand government mortgage relief programs, which could be contributing to high overall delinquency rates.
“While job and income growth has helped to push delinquency rates down, there are many families that remain in financial distress,” said Dr. Frank Nothaft, chief economist at CoreLogic. “More than one million borrowers had missed six or more payments as of June, triple the number of borrowers pre-pandemic. CoreLogic analysis found that as of June 2021, borrowers in forbearance and behind on mortgage payments had missed an average of 10 monthly payments.”
Additional highlights from CoreLogic's Loan Performance Insight Report:
- In June, all U.S. states logged a decrease in annual overall delinquency rates.
- All U.S. metros also posted an annual decrease in overall delinquency rates in June with Miami (down 6.6%), Laredo, Texas (down 5.7%), and Kingston, New York (down 5.6%) posting the largest decreases.
- Elevated overall delinquency rates remain in some metros, including Odessa (11.1%) and Laredo (10.7%), Texas; Vineland, New Jersey (10.6%); and Pine Bluff, Arkansas (10.4%).
