Wednesday, March 30, 2016

Fannie Mae: Mortgage Serious Delinquency rate declined in February, Lowest since July 2008

by Bill McBride on 3/30/2016 04:41:00 PM

Fannie Mae reported today that the Single-Family Serious Delinquency rate declined in February to 1.52%, down from 1.55% in January. The serious delinquency rate is down from 1.83% in February 2015.

This is the lowest rate since July 2008.

The Fannie Mae serious delinquency rate peaked in February 2010 at 5.59%.

Note: These are mortgage loans that are "three monthly payments or more past due or in foreclosure".

Note: Freddie Mac has not reported for February yet.

Fannie Freddie Seriously Delinquent RateClick on graph for larger image

The Fannie Mae serious delinquency rate has only fallen 0.31 percentage points over the last year - the pace of improvement has slowed - and at that pace the serious delinquency rate will not be below 1% until 2017.

The "normal" serious delinquency rate is under 1%, so maybe Fannie Mae serious delinquencies will be close to normal some time in 2017.  This elevated delinquency rate is mostly related to older loans - the lenders are still working through the backlog.