The delinquency rate for mortgage loans on one-to-four-unit residential properties rose to a seasonally adjusted rate of 4.42 percent of all loans outstanding at the end of the first quarter, according to the Mortgage Bankers Association’s (MBA) National Delinquency Survey.
Despite an uptick of 36 basis points on a quarterly basis, the delinquency rate was still down 21 basis points from one year ago. The percentage of loans on which foreclosure actions were started last quarter fell by 5 basis points from a year ago and 2 basis points from last quarter (to 0.23 percent).
“The national mortgage delinquency rate in the first quarter of 2019 was down on a year-over-year basis, which is another sign of a very strong economic environment, bolstered by low unemployment and rising wage growth,” said Marina Walsh, MBA’s Vice President of Industry Analysis. “Moreover, the serious delinquency rate – the percentage of loans that are 90 days or more past due or in the process of foreclosure – dropped across all loan types from the previous quarter and a year ago to its lowest overall level since the second quarter of 2006.”
Walsh noted that early 30-day delinquencies rose in the first quarter of 2019 on a seasonally-adjusted basis across all loan types. The rise in early delinquencies resulted in the overall mortgage delinquency rate climbing by 36 basis points. While higher than several quarters in 2017 and 2018, it is still the fourth lowest overall mortgage delinquency rate in the past 12 years.
Key findings of MBA’s First Quarter of 2019 National Delinquency Survey:
· Compared to last quarter, the seasonally adjusted mortgage delinquency rate increased for all loans outstanding. By stage, the 30-day delinquency rate increased 29 basis points to 2.58 percent, the 60-day delinquency rate increased 7 basis points to 0.81 percent, and the 90-day delinquency bucket remained unchanged at 1.03 percent.
· By loan type, the total delinquency rate for conventional loans increased 27 basis points to 3.46 percent compared to the last quarter of 2018. The FHA delinquency rate increased 28 basis points to 8.93 percent, and the VA delinquency rate increased by 66 basis points to 4.37 percent.
· On a year-over-year basis, the seasonally adjusted overall delinquency rate decreased for all loans outstanding. The delinquency rate decreased by 32 basis points for conventional loans, decreased 9 basis points for FHA loans and increased 5 basis points for VA loans.
· The delinquency rate includes loans that are at least one payment past due, but does not include loans in the process of foreclosure. The percentage of loans in the foreclosure process at the end of the first quarter was 0.92 percent, down 3 basis points from the fourth quarter and 24 basis points lower than one year ago. This is the lowest foreclosure inventory rate since the fourth quarter of 1995.
· The serious delinquency rate, the percentage of loans that are 90 days or more past due or in the process of foreclosure, was at 1.96 percent – a decrease of 10 basis points from last quarter and a decrease of 65 basis points from last year. The serious delinquency rate decreased by 6 basis points for conventional loans, 31 basis points for FHA loans, and 9 basis points for VA loans from the previous quarter. Compared to a year ago, the serious delinquency rate decreased by 67 basis points for conventional loans, 77 basis points for FHA loans and 35 basis points for VA loans.
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The above data were obtained in cooperation with the Mortgage Bankers Association (MBA), which produces the National Delinquency Survey (NDS). The NDS, which has been conducted since 1953, covers 38 million loans on one- to four- unit residential properties. Loans surveyed were reported by over 100 lenders, including mortgage bank, commercial banks, and thrifts.