U.S. Mortgage Delinquencies Decline in March, but Quadruple in Puerto Rico

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The share of home mortgage loan payments that were 30 days or more past due fell from 4.4% in March 2017 to 4.3% in March 2018. The foreclosure inventory rate declined from 0.8% to 0.6% in the same period.

The share of mortgages that transitioned from current to 30 days past due was 0.7% in March 2018, a rise from 0.6% in March 2017. This year’s rate remains somewhat lower than the transition rate of 1.2% just before the housing crisis struck–and well below the peak rate of 2% in November 2008.

CoreLogic reported this data on Tuesday in its Loan Performance Insights report. Early-stage delinquencies, defined as 30 to 59 days past due, remained flat year over year in March, at 1.7%. The share of mortgages that were 60 to 89 days past due in March was 0.6%, also flat with last year’s rate. According to CoreLogic, measuring early-stage delinquency rates is important for analyzing the health of the mortgage market.

CoreLogic’s chief economist, Frank Nothaft, said:

Unemployment and lack of home equity are two factors that can lead to borrowers defaulting on their mortgages. Unemployment is at the lowest level in 18 years, and for the first quarter, the CoreLogic Equity Report revealed record levels of home equity growth with equity per owner up $16,300 on average for the year ending March 2018.

Frank Martell, president and CEO of CoreLogic, added:

As we enter the summer, the risk of hurricane and wildfire damage to homes increases as does the risk of damage-related loan default. Last year’s hurricanes and wildfires continue to affect today’s default rates. Serious delinquency rates are more than double what they were before last autumn’s hurricanes in Houston, Texas, and Naples, Florida. The serious delinquency rates have also quadrupled in Puerto Rico.

The states with the lowest 30-plus delinquency rate in March 2018 were Colorado (1.8%), North Dakota (1.9%) and Washington and Oregon (2.1%). The 30-plus delinquency rate was highest in Mississippi (7.7%) and Florida and Louisiana (8.1%).

Among the largest U.S. metro areas, the highest 30-plus delinquency rates in March were posted in Miami (9.1%) and Houston (7.6%). Among these metro areas, the lowest rate was reported in San Francisco (1.5%) and Denver (1.6%).