Home / Daily Dose / Delinquency Rate Sees Largest Monthly Increase Since November 2014
Print This Post Print This Post

Delinquency Rate Sees Largest Monthly Increase Since November 2014

delinquent-noticeMay 2015 saw the largest month-over-month increase in delinquent residential mortgages for any May since 2009 and the largest month-over-month increase for any month since November 2014, according to Black Knight Financial Services' May 2015 Mortgage Monitor released on Monday.

Delinquent residential mortgages, defined as those 30 days or more overdue but not in foreclosure, jumped by 4 percent from April to May up to about 2.5 million, according to Black Knight. The delinquency rate has increased month-over-month in seven of the last 10 Mays (2006, 2008, and 2013 were the only months that saw declines); the May 2015 increase was the largest since May 2009, when it jumped by 4.5 percent.

May 2015's increase was also the largest month-over-month spike for any month since it jumped by 12 percent in November 2014. That month, just like May 2015, ended on a Sunday. According to Black Knight, months that end on a Sunday historically trigger increases in delinquency rates; the top five month-over-month increases in the last seven years have all come on months that ended on a Sunday, Black Knight reported.

Despite the frequent month-over-month delinquency rate increases in the month of May over the last few years, the delinquency rate declined by 12 percent year-over-year in May 2015, which calculated to about 326,000 fewer mortgages.

May's month-over-month rise in delinquencies was nearly an across-the-board increase through all product types, loan vintages, and credit score groups, according to Black Knight. The largest increase in delinquencies was seen among Federal Housing Administration/Veterans Affairs (FHA/VA) loans at 7.6 percent. The delinquency increase in FHA/VA loans increase was most more predominant loans with a post-crisis vintage (2009 through 2014), though the delinquency rate was consistent across loans with all LTV levels, according to Black Knight.

The delinquency rate increased month-over-month in May for option/adjustable rate mortgage (ARM) loans (5.2 percent), subprime mortgage loans (2.3 percent), Alt-A (between prime and subprime) loans (2.1 percent), FHA/VA loans (7.6 percent), and agency prime loans (2.8 percent). The one category that saw a month-over-month decline in delinquency rate was non-agency jumbo prime loans (minus 0.8 percent), according to Black Knight.

About Author: Brian Honea

Brian Honea's writing and editing career spans nearly two decades across many forms of media. He served as sports editor for two suburban newspaper chains in the DFW area and has freelanced for such publications as the Yahoo! Contributor Network, Dallas Home Improvement magazine, and the Dallas Morning News. He has written four non-fiction sports books, the latest of which, The Life of Coach Chuck Curtis, was published by the TCU Press in December 2014. A lifelong Texan, Brian received his master's degree from Amberton University in Garland.

Check Also

Upcoming Hurricane Season May Threaten an Estimated 33 Million U.S. Homes

A new report from CoreLogic has found that climate change is expected to alter hurricane activity this year, placing $11.6 trillion total reconstruction cost value at risk of hurricane-force wind damage across U.S. coastal counties.