The mortgage delinquency rate increased to a seasonally adjusted 3.97% as of the end of the second quarter, according to the Mortgage Bankers Association’s (MBA) National Delinquency Survey.
That’s up 3 basis points from the first quarter and up 60 basis points from the second quarter of 2023.
The percentage of loans on which foreclosure actions were started in the second quarter fell by 1 basis point to 0.13%.
“Mortgage delinquencies increased across all product types compared to this time last year,” says Marina Walsh, vice president of industry analysis for the MBA, in a statement. “While delinquencies are still low by historical standards, the recent increase corresponds with a rising unemployment rate, which has historically been closely correlated with mortgage performance.
“The composition of mortgage delinquencies by stage has evolved,” Walsh adds. “As of the second quarter of 2024, the earliest stage delinquencies – those loans 60 days or less delinquent – accounted for the entire increase from the previous year. Meanwhile, seriously delinquent loans – those loans 90 days or more delinquent or in foreclosure – fell to their lowest levels since 1984 as servicers are helping at-risk homeowners avoid foreclosures through loan workout options that can mitigate temporary distress.”
Compared to last quarter, the seasonally adjusted mortgage delinquency rate increased for all loans outstanding.
By stage, the 30-day delinquency rate increased 1 basis point to 2.26%, the 60-day delinquency rate increased 3 basis points to 0.70%, and the 90-day delinquency bucket decreased 1 basis point to 1.01%.
By loan type, the total delinquency rate for conventional loans increased 2 basis points to 2.64% over the previous quarter. The FHA delinquency rate increased 21 basis points to 10.60%, and the VA delinquency rate decreased 3 basis points to 4.63%.
The five states with the largest quarterly increases in their overall delinquency rate included Mississippi (58 basis points), Louisiana (54 basis points), Indiana (53 basis points), Ohio (53 basis points) and West Virginia (52 basis points).
Photo: Alexander Grey