Delinquency Rate for Mortgage Loans on the Rise – MBA
February 17, 2023
The delinquency rates for loans on residential properties increased at the end of 2022 amid economic headwinds and inflationary pressures, the Mortgage Bankers Association reported Thursday.
Mortgage delinquency rates rose to a seasonally adjusted rate of 3.96% in the fourth quarter, up 51 basis points from the third quarter but still down 69 basis points from a year ago. The share of loans on which foreclosure actions were started in Q4 dropped by one basis point to 0.14%.
“As expected, the overall national mortgage delinquency rate increased in the fourth quarter of 2022 from its previous quarterly survey low,” said Marina Walsh, vice president of industry analysis at MBA. “The weaker economy and ongoing inflationary pressures contributed to the uptick in delinquencies. The delinquency rate – while still low – increased from the previous quarter across all loan types and across all stages of delinquency.”
Walsh noted that, for the last 15 years, mortgage delinquencies have tracked very closely with employment conditions. The Bureau of Labor and Statistics’ latest report showed 517,000 jobs added in January, with the unemployment rate hovering at 3.4%.
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