The share of home mortgage loan payments that are 30 days or more past due fell from 5.3% in May 2016 to 4.5% in May 2017. The foreclosure inventory rate fell from 1% to 0.7% in the same period.
The share of mortgages that transitioned from current to 30 days past due was 0.9% in May 2016 compared with 0.8% in May 2017. This current rate is well below the peak rate of 2% in November 2008.
The data were reported Tuesday by CoreLogic in its Loan Performance Insights report. Early-stage delinquencies, defined as 30 to 59 days past due, were trending slightly lower in May 2017 at 1.9% compared with the year-ago rate of 2%. The share of mortgages that were 60 to 89 days past due in May 2017 was 0.6%, down from the year-ago rate of 0.7%. According to CoreLogic, measuring early-stage delinquency rates is important for analyzing the health of the mortgage market.
CoreLogic’s chief economist, Dr. Frank Nothaft, said:
Strong employment growth and home price increases have contributed to improved mortgage performance. Early-stage delinquencies are hovering around 17-year lows, and the current-to-30-day past due transition rate remained low at 0.8 percent. However, the same positive economic conditions helping performance have also contributed to a lack of affordable supply, creating challenges for homebuyers.
Frank Martell, president and CEO of CoreLogic, added:
A prolonged period of relatively tight underwriting criteria has driven delinquencies down to pre-crisis levels across many parts of the country. As pressure to relax underwriting standards increases, the industry needs to proceed carefully and take progressive, sensible actions that protect hard-fought improvements in mortgage performance.
The three states with the lowest 30-plus delinquency rate in January 2017 were North Dakota (2.0%), Colorado (2.1%) and Montana (2.5%). The 30-plus delinquency rate was highest in Mississippi (8.2%), Louisiana (7.6%) and New Jersey (7.1%).