Mortgage Delinquencies Level Off, According to CoreLogic Report

According to a  CoreLogic Insights Blog report just posted, loan performance insights highlights for September 2020 include:

  • The nation’s overall delinquency rate was 6.3% in September.
  • All states experienced annual increases in both overall and serious delinquency rates in September.
Source: CoreLogic
Source: CoreLogic

In September 2020, 6.3% of home mortgages were in some stage of delinquency (30 days or more past due, including those in foreclosure), which was a small decline from August 2020, but a 2.5% increase from September 2019.

Mortgages in early-stage delinquencies (30-59 days past due) was 1.5% in September 2020, down sharply from 4.2% in April 2020 and also below the rate from one year ago, which was 1.9%. Mortgages that were 60-89 days past due was 0.7% in September 2020, up from 0.6% in September 2019, but down from 2.8% in May 2020.

The serious delinquency rate, which is identified as 90 days or more past due, including loans in foreclosure, was 4.2% in September, up from 1.3% a year earlier, but down a bit from 4.3% in August 2020. August represented the highest rate since February 2014. The spike in delinquency that began in April has worked its way through the stages of delinquency and is sitting in the 180-days past-due stage, which increased to 1.6% in September, the highest rate since 2014 and more than five times the year ago rate.

The CARES Act provides relief to mortgage holders and prevented the seriously delinquent mortgages from progressing into foreclosure. The foreclosure inventory rate – the share of mortgages in some stage of the foreclosure process remained low at 0.3% in September 2020, down from 0.4% in September 2019.

Source: CoreLogic
Source: CoreLogic

States with the highest and lowest share of mortgages that are 30 days or more delinquent are shown in the above graph. All states posted annual gains in their overall delinquency rate in September 2020. The states that logged the largest annual increases were Nevada (+4.9 percentage points), Hawaii (+4.7 percentage points), Florida (+4 percentage points) and New Jersey (+3.9 percentage points).

Source: CoreLogic
Source: CoreLogic

The graph above shows the 30-plus-day past-due rate for September 2020 for 10 large metropolitan areas. Miami is in the lead with the highest rate of 11%, San Francisco has the lowest rate at 3.9%, Miami experienced an increase of 6 percentage points from the year prior. Outside of the largest 10, all but two metros recorded an increase in overall delinquency rate. Metro areas that were also hit hard included Lake Charles, Louisiana with the largest spike of 10.7 percentage points, followed by Odessa, Texas (up 10.3 percentage points) and Kahului, Hawaii (up 7.5 percentage points).