In January of this year, 3.3% of all mortgages in the U.S. ere in some stage of delinquency (30 days or more past due, including those in foreclosure), representing a 2.3 percentage point decrease compared to January 2021, when it was 5.6%.
In January, the U.S. delinquency and transition rates, and their year-over-year changes, were as follows:
- Early-Stage Delinquencies (30 to 59 days past due): 1.2%, down from 1.3% in January 2021.
- Adverse Delinquency (60 to 89 days past due): 0.3%, down from 0.5% in January 2021.
- Serious Delinquency (90 days or more past due, including loans in foreclosure): 1.8%, down from 3.8% in January 2021 and a high of 4.3% in August 2020.
- Foreclosure Inventory Rate (the share of mortgages in some stage of the foreclosure process): 0.2%, down from 0.3% in January 2021.
- Transition Rate (the share of mortgages that transitioned from current to 30 days past due): 0.7%, unchanged from January 2021.
The drop in delinquency rates marks its tenth consecutive month of year-over-year declines. Thiscan be attributed to two factors: escalating home prices and a strengthening job market. According to the latest job report from the U.S. Department of Labor, the country added 562,000 positions per month during the first quarter of 2022.
While the U.S. foreclosure rate declined compared to January 2021, the expiration of moratoriums in some states caused the number of foreclosures to rise from December 2021. Nevertheless, the January 2022 foreclosure rate was flat from December and is still the lowest recorded since at least 1999.
“The large rise in home prices—up 19% in January from one year earlier, according to CoreLogic indexes for the U.S.—has built home equity and is an important factor in the continuing low level of foreclosures,” said Dr. Frank Nothaft, Chief Economist of CoreLogic. “Nonetheless, there are many homeowners that have faced financial hardships during the pandemic and are emerging from 18 months of forbearance. The U.S. may experience an uptick in distressed sales this year as some owners struggle to remain current after forbearance and loan modification.”
All states logged year-over-year declines in their overall delinquency rates in January. The states with the largest declines are:
- Nevada (down 3.7 percentage points)
- Hawaii (down 3.5 percentage points)
- New Jersey (down 3.2 percentage points)
All other states, including Washington D.C. registered drops between 1.0 and 3.1 percentage points.
Serious delinquencies, defined as a loan more than 90 days past due, including loans in foreclosure, remained the same or decreased in all 384 metropolitan areas monitored by the report.
To view a complete copy of the report, including interactive data, click here.