Serious mortgage delinquency rates hit lowest level since late 1990s

Decline in mortgage delinquencies signals strong housing market, says CoreLogic

Serious mortgage delinquency rates hit lowest level since late 1990s

CoreLogic has published its mortgage delinquency report for August, revealing a 0.2% year-over-year drop in overall delinquencies.

The report showed that 2.6% of all mortgages were in some stage of delinquency (30 days or more past due, including those in foreclosure), marking a 0.2 percentage point decrease from August 2022 and a 0.1 percentage point drop from July 2023.

Breaking down the figures, early-stage delinquencies (30 to 59 days past due) rose slightly to 1.3%, up from 1.2% in August 2022. Adverse delinquencies (60 to 89 days past due) also increased to 0.4% from 0.3% in the previous year.

However, serious delinquencies (90 days or more past due, including loans in foreclosure) decreased to 0.9%, down from 1.2% in August 2022 and significantly lower than the 4.3% high in August 2020. The foreclosure inventory rate remained stable at 0.3%, unchanged from August 2022.

The report highlights a significant milestone, with the share of mortgages falling into serious delinquency reaching the lowest level in nearly 25 years at 0.9%. This decline indicates that most homeowners are currently able to meet their monthly mortgage payments. Despite this positive trend, the rising interest rates, which approached 8% in October, could potentially sideline more prospective buyers.

“US mortgage performance remained strong in August, supported by a robust job market and a healthy economy,” said CoreLogic principal economist Molly Boesel. “However, this thriving job market comes at a time when interest rates are quickly rising, which is keeping many potential homebuyers from being able to secure a mortgage.”

Idaho and Utah both saw small annual increases in overall mortgage delinquency rates, each up by 0.1%. In contrast, Arizona, Florida, Indiana, and Oregon experienced no year-over-year change in overall delinquency rates. The remaining states reported declines in annual delinquency rates ranging from 0.1% to 0.8%.

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