Thanks to an improving economy and growing home equity, the U.S. mortgage delinquency rate hit its lowest level in recorded history in December, falling to just 3.4% of all loans, according to CoreLogic.
That’s down from 5.8% of all loans in December 2020.
The firm’s monthly Loan Performance Insights Report shows that early-stage delinquencies (30 to 59 days past due) represented just 1.2% of all loans in December, down from 1.4% in December 2020.
Loans 60 to 89 days past due represented a mere 0.3% of all loans, down from 0.5% in December 2020.
Serious delinquencies (90 days or more past due, including loans in foreclosure) represented 1.9% of all loans, down from 3.9% in December 2020.
As of the end of December, the foreclosure inventory rate stood at 0.2%, down from 0.3% in December 2020.
This is the lowest foreclosure rate recorded since at least January 1999.
“The U.S. unemployment rate declined for the sixth straight month in December 2021 to the lowest since the beginning of the COVID-19 pandemic,” the report states. “Meanwhile, national home prices increased by 18.5 percent year over year, helping more owners regain equity. The combination of these dynamics pushed the overall mortgage delinquency and foreclosure rates to the lowest levels that CoreLogic has recorded in more than two decades.”
“Nonfarm employment grew by 6.7 million workers during 2021, the largest one-year increase, supporting income growth and keeping more families current on their loans,” says Frank Nothaft, chief economist at CoreLogic. “Nonetheless, places hit hard by natural disasters have experienced a spike in missed payments. Serious delinquency rates for December in the Houma-Thibodaux metro area were nearly two percentage points higher than immediately before Hurricane Ida.”
Photo: Pepi Stojanovski
