CoreLogic’s monthly Loan Performance Insights Report for January 2022 shows that 3.3% 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 2.3 percentage point decrease compared to January 2021, when it was 5.6%.
This figure again marks the lowest recorded overall delinquency rate in the U.S. since at least January 1999.
In January 2022, the U.S. delinquency and transition rates and their 2022 to 2021 changes were 1.2% from 1.3% for early-stage delinquencies (30 to 59 days past due), 0.3% from 0.5% for adverse delinquency (60 to 89 days past due), and 1.8% from 3.8% for serious delinquency (90 days or more past due, including loans in foreclosure) with a high of 4.3% in August 2020.
The foreclosure inventory rate (the share of mortgages in some stage of the foreclosure process) was 0.2%, down from 0.3% in January 2021 while the transition rate (the share of mortgages that transitioned from current to 30 days past due) was unchanged at 0.7%.
The drop in the nation’s overall mortgage delinquency rate in January marked the 10th consecutive month of year-over-year declines. This trend can be attributed to two familiar factors: escalating home prices and a strong job market. U.S. home prices continue to reach new highs, posting 20% year-over-year growth in February. Meanwhile, the latest U.S. jobs report shows that the country added an average of 562,000 positions per month in 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 percent 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,” states 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.”
In January, all states logged year-over-year declines in their overall delinquency rate. The states with the largest declines were Nevada (down 3.7 percentage points), Hawaii (down 3.5 percentage points) and New Jersey (down 3.2 percentage points). The remaining states, including the District of Columbia, registered annual delinquency rate drops between 3.1 percentage points and 1 percentage points.
All U.S. metro areas posted at least a small annual decrease in overall delinquency rates, including those that were previously affected in the aftermath of Hurricane Ida last fall. The top four metros with the largest declines were: Odessa, Texas (down 6.3 percentage points); Kahului-Wailuku-Lahaina, Hawaii (down 6.1 percentage points); Laredo, Texas (down 5.9 percentage points); and Lake Charles, La. (down 5.8 percentage points).