Residential and commercial mortgage default rates grew by 10 and 20 basis points, respectively, in the third quarter, according to a forecast from Foresight Analytics, a division of Trepp LLC. The firm released its projections in advance of the final third-quarter figures from the Federal Deposit Insurance Corp.
According to Foresight, residential mortgage delinquencies grew from 13.2% in the second quarter to 13.3% in the third, while commercial mortgage delinquencies rose from 5.4% to 5.6%.
"These delinquency rates are still below the 1Q 2010 peak rates, and are likely to be the apex in delinquencies barring a return to recession,’ says Matt Anderson, managing director of Foresight Analytics. ‘If the tepid economic recovery manages to heat up and real estate values rise, some of the pressure on commercial mortgages will also be relieved."
SOURCE: Foresight Analytics