Tuesday, November 13, 2018

CoreLogic: "Mortgage Delinquency Rate the Lowest Level in More Than 12 Years"

by Bill McBride on 11/13/2018 11:29:00 AM

From CoreLogic: CoreLogic Loan Performance Insights Find the Overall US Mortgage Delinquency Rate in August Fell to the Lowest Level in More Than 12 Years

The report shows that, nationally, 4 percent of mortgages were in some stage of delinquency (30 days or more past due, including those in foreclosure) in August 2018, representing a 0.6 percentage point decline in the overall delinquency rate compared with August 2017, when it was 4.6 percent.

As of August 2018, the foreclosure inventory rate – which measures the share of mortgages in some stage of the foreclosure process – was 0.5 percent, down 0.1 percentage point since August 2017. The August 2018 foreclosure inventory rate tied with the April, May, June and July rates this year as the lowest for any month since September 2006, when it was also 0.5 percent.

Measuring early-stage delinquency rates is important for analyzing the health of the mortgage market. To monitor mortgage performance comprehensively, CoreLogic examines all stages of delinquency, as well as transition rates, which indicate the percentage of mortgages moving from one stage of delinquency to the next.

The rate for early-stage delinquencies – defined as 30 to 59 days past due – was 1.8 percent in August 2018, down from 2 percent in August 2017. The share of mortgages that were 60 to 89 days past due in August 2018 was 0.6 percent, down from 0.7 percent in August 2017. The serious delinquency rate – defined as 90 days or more past due, including loans in foreclosure – was 1.5 percent in August 2018, down from 1.9 percent in August 2017. This serious delinquency rate was the lowest for August since 2006 when it was 1.4 percent, and the lowest for any month since March 2007 when it was also 1.5 percent.

Since early-stage delinquencies can be volatile, CoreLogic also analyzes transition rates. The share of mortgages that transitioned from current to 30 days past due was 0.8 percent in August 2018, down from 0.9 percent in August 2017. By comparison, in January 2007, just before the start of the financial crisis, the current-to-30-day transition rate was 1.2 percent, while it peaked in November 2008 at 2 percent.
CR Note: Mortgage delinquency rates - and foreclosure rates - are close to normal.