Mortgage Delinquencies Increase in the Fourth Quarter of 2024
Industry Update
February 6, 2025
Source: Mortgage Bankers Association
The delinquency rate for mortgage loans on one-to-four-unit residential properties increased to a seasonally adjusted rate of 3.98 percent of all loans outstanding at the end of the fourth quarter of 2024, according to the Mortgage Bankers Association’s (MBA) National Delinquency Survey.
The delinquency rate was up 6 basis points from the third quarter of 2024 and up 10 basis points from one year ago. The percentage of loans on which foreclosure actions were started in the fourth quarter rose by 1 basis point to 0.15 percent.
“Although mortgage delinquencies rose only ten basis points in the fourth quarter of 2024 compared to one year ago, the composition of the delinquencies changed,” said Marina Walsh, CMB, MBA’s Vice President of Industry Analysis. “Conventional delinquencies remain near historical lows, but FHA and VA delinquencies are increasing at a faster pace. By the end of the fourth quarter, the spread between the FHA and conventional delinquency rates reached 841 basis points, while the VA and conventional spread was 208 basis points.”
Added Walsh, “Government loans are also rolling to later stages of delinquency. Compared to one year ago, the seriously delinquent rate rose seventy basis points for FHA loans and fifty-seven basis points for VA loans, but only two basis points for conventional loans.”
According to Walsh, while the labor market remains relatively strong and often tracks with mortgage performance, some of today’s headwinds include inflationary pressures, lower personal savings rates, natural disasters, increasing consumer debt, higher tax and insurance payments, and higher debt-to-income ratios. All of these factors may be impacting government borrowers to a greater extent than conventional borrowers.
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