For the first time since March 2020, the nation’s overall
mortgage delinquency rate decreased from the year before. While on a local level,
some areas are still struggling from job losses and natural disasters, the
nation is moving in the direction of recovered financial health for borrowers.
CoreLogic, a global property information, analytics and
data-enabled solutions provider, today released its monthly Loan Performance
Insights report for April 2021.
For April, 4.7% of all mortgages in the U.S. were in some
stage of delinquency (30 days or more past due, including those in
foreclosure), representing a 1.4 percentage point decrease in delinquency
compared to April 2020, when it was 6.1%. This month’s overall delinquency
marks the lowest rate in a year.
To gain an accurate view of the mortgage market and loan
performance health, CoreLogic examines all stages of delinquency. In April
2021, the delinquency and transition rates, and their year-over-year changes,
were as follows:
· Early-stage delinquencies
(30 to 59 days past due): 1%, down from 4.2% in April 2020.
· Adverse delinquency
(60 to 89 days past due): 0.3%, down from 0.7% in April 2020.
· Serious delinquency (90 days or more past due, including
loans in foreclosure): 3.3%, up from 1.2% in April 2020.
· Foreclosure inventory rate (the share of mortgages in some
stage of the foreclosure process): 0.3%, unchanged from April 2020.
· Transition rate (the share of mortgages that transitioned
from current to 30 days past due): 0.6%, down from 3.4% in April 2020.
CoreLogic’s data for April 2021 reports its first
year-over-year decrease and the lowest overall delinquency rate since the onset
of the pandemic as job and income recovery enables more homeowners to remain or
return to current mortgage payment status.
Additionally, in an effort to help borrowers who are in
forbearance programs, financial institutions and government entities are
continuing to enact provisions that give homeowners ample opportunity to bounce
back and keep their homes.
“The sharp rebound in
the economy, as well as a potent combination of government fiscal and
regulatory help, is fueling unprecedented demand for residential housing and
enabling people to buy and stay in their homes,” said Frank Martell, president
and CEO of CoreLogic. “The drop in delinquency rates is a further manifestation
of the benefits of these tail winds. Barring an unforeseen change, we expect
rates to continue to fall and home prices rise over the next 12 to 18 months.”
“Natural hazard
events and job loss in the oil and gas industry during the past year continue
to affect local delinquency rates, despite a general decline in delinquency
rates in many urban areas,” said Frank Nothaft, chief economist at CoreLogic.
“Of all metros, Odessa and Midland, Texas, had the largest one-year jumps in
serious delinquency rates, followed by Lake Charles, Louisiana, which was hit
hard by Hurricanes Laura and Delta in 2020.”
State and metro takeaways
· In April, nearly all states logged a decrease in annual
overall delinquency rates (only Wyoming experienced a slight increase with a
0.1 percentage-point uptick), and a significant portion of metro areas posted
at least a small annual decrease, with only eight experiencing a year-over-year
increase.
· Among metros, Odessa, Texas, still recovering from job
losses in the oil industry, had the largest annual overall delinquency increase
with 2.4 percentage points.
· Other metro areas with significant overall delinquency
increases included Midland, Texas (up 2.3 percentage points); Lake Charles,
Louisiana (up 0.8 percentage points); Enid, Oklahoma (up 0.7 percentage points)
and Casper, Wyoming (up 0.6 percentage points).
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