CoreLogic released its monthly Loan Performance Insights Report for November 2021, which showed that national delinquency dropped below March 2020 levels for the first time since the onset of the pandemic. In November, 3.6% of all mortgages in the United States were in some stage of delinquency, marking a 2.3% decrease compared to the previous year when it was 5.9%.
In November, early-stage delinquencies (30 to 59 days past due) made up 1.2% of all mortgages, down from 1.4% during the same time last year. Adverse delinquencies (60 to 89 days past due) were at 0.3% in November, down 0.6% from last year. Serious delinquencies (90 days or more past due, including loans in foreclosure) were at 2%, down from 3.9% a year earlier and a high of 4.3% in August 2020.
The foreclosure inventory rate (the share of mortgages in some stage of the foreclosure process) was at 0.2% in November, down from 0.3% a year earlier — representing the lowest foreclosure rate recorded since 1999. Meanwhile, the transition rate (the share of mortgages that transitioned from current to 30 days past due) was at 0.6%, down from 0.8% in November.
November 2021 was the month we finally saw overall delinquencies recover, a sign that mortgage loan performance is following the nation’s income growth. Foreclosure rates remain at historic lows as borrowers have been able to lean into equity generated by a year of record-breaking home price growth. These factors have helped borrowers stay afloat during the pandemic and avoid falling behind on payments or losing their homes.
“Nonfarm employment rose 6.45 million during 2021, helping to rebuild income for families under financial stress during the pandemic,” said Dr. Frank Nothaft, chief economist at CoreLogic. “Income growth has helped to reduce past-due rates and home equity build-up has reduced the likelihood of a distressed sale for families that experience financial challenges.”
All states logged year-over-year declines in delinquencies for November 2021. The states that truly took the cake by reducing delinquencies the most were Nevada (down 3.8 percentage points); New Jersey (down 3.6 percentage points); Hawaii (down 3.5 percentage points); Florida (down 3.4 percentage points); and New York (down 3.2 percentage points).
The only metro area in the United States that had an annual increase in delinquencies for November 2021 was Houma-Thibodaux, Louisiana (up 0.4 percentage points). Unfortunately, Houma-Thibodaux was heavily impacted by Hurricane Ida in the fall, but its delinquency rate has been slowly declining since October as the area recovers.
