CoreLogic’s [1] Loan Performance Insights Report [2] for September 2021 found that just 3.9% of all mortgages nationwide were in some stage of delinquency (30 days or more past due, including those in foreclosure), a 2.4-percentage point decrease in delinquency compared year-over-year, when the delinquency rate stood at 6.3%. Before the pandemic, the delinquency rate stood at 3.8% over the same period in 2019.
According to CoreLogic, the report also found that early-stage delinquencies (which are considered 30–59 days past due) stood at 1.1%, down from 1.5% in September 2020. Adverse delinquencies (60–89 days past due) accounted for 0.3% of volume, down from 0.7% in September 2020, serious delinquencies (90 or more past due, including loans in foreclosure) accounted for 2.4%, down from 4.2% year-over-year.
On a good note, the foreclosure inventory rate—which is the share of mortgages in some stage of the foreclosure process—stood at 0.2%, which is the lowest rate recorded by CoreLogic since 1999. The transition rate also remained low at 0.6%, which is the share of mortgages that transitioned from current to past due.
The outlook is good for those exiting forbearance as well. Due to “soaring” home equity, relatively few of these borrowers will fall into foreclosure as they exit forbearance, despite the fact that one-in-two delinquent borrowers are behind on their mortgage by at least six months.
“Record home equity levels have been a boon to many homeowners navigating the cross currents of the pandemic,” said Frank Martell [3], President and CEO of CoreLogic. “Not only have homeowners used this equity to fuel a record level of home improvements and renovation, it has proven to be a vital factor in helping families ward off foreclosure, pay down existing debt and weather changing market conditions.”
“The economic recovery has pushed down the percent of delinquent borrowers to the lowest level since the pandemic began,” said Dr. Frank Nothaft [4], chief economist at CoreLogic. “The number of borrowers past due on their mortgage doubled between March and May 2020. The past due rate in September 2021 was the lowest since March 2020.”
On a state level, there was no state that saw the delinquency rate rise in September. The states with the largest declines were Nevada (down 3.7 percentage points), Florida (down 3.6 percentage points), and New Jersey (down 3.6 percentage points).
The same was true on a metropolitan level. Of the 384 metropolitan areas tracked by CoreLogic, none saw a rise in serious delinquencies.