The national mortgage delinquency rate has dropped nearly a quarter in the last year, according to credit information bureau TransUnion.
The rate of borrowers 60 or more days delinquent on their mortgages was 4.09% at the end of the third quarter, TransUnion reported Tuesday. That’s a 23.3% dive from Q3 of 2012. Delinquencies also dropped quarter-over-quarter for the seventh consecutive time, down from 4.32% in Q2.
“This isn't a sample data set,” said Tim Martin, group vice president of U.S Housing for TransUnion's financial services business unit. “We looked at all 52 million installment-based mortgages in the U.S., and the trend is clear -- the percentage of borrowers willing and able to make their mortgage payments continues to improve. The overall delinquency rate is still high relative to ‘normal,’ but a 23% year over year improvement is great news for homeowners and their lenders.”
Delinquencies declined year-over-year in all 50 states and the District of Columbia, TransUnion reported. California saw the largest drop, with delinquencies declining 38.5% year over year. Similar declines were reported in Arizona (38.1%) and Nevada (32.2%).
Originations were also up in the report – but Martin warned that those were viewed one quarter in arrears to ensure new accounts are included in the delinquency data.
“New mortgage originations showed good growth through the second quarter of this year, largely the result of increased refinance transactions driven by low rates and increasing home prices,” Martin said. “However, mortgage rates started to increase right around Memorial Day, and when the data come out next quarter, we expect it to show that new originations are decreasing as a result.”