The national delinquency rate for mortgage loans on one-to-four-unit residential properties increased to 3.99% at the end of the third quarter, according to the Mortgage Bankers Association (MBA).
That seasonally adjusted figure is up 6 basis points compared with the second quarter and up 7 basis points from one year ago.
The percentage of loans on which foreclosure actions were started rose by 3 basis points to 0.20%.
“Mortgage delinquencies increased in third quarter of 2025, led by worsening FHA loan performance,” says Marina Walsh, CMB, vice president of industry analysis, in the MBA’s latest National Delinquency Survey. “Since this time last year, the FHA seriously delinquent rate – which includes 90+ day delinquencies and loans in foreclosure – increased by almost 50 basis points. In contrast, the conventional and VA seriously delinquent rates remained relatively flat.”
“The stressors on FHA homeowners include a softer labor market, other personal debt obligations, and increases in taxes, homeowners’ insurance and other fees that exacerbate already stretched affordability,” Walsh says. “Additionally, home price declines in some parts of the country may lessen the ability to sell or refinance.”
Walsh also noted that while the third quarter results were not impacted by the ending of COVID-era FHA loss mitigation options and the recent government shutdown, those events may affect future quarters.
By stage, the 30-day delinquency rate increased 2 basis points to 2.12%, the 60-day delinquency rate increased 4 basis points to 0.76%, and the 90-day delinquency bucket remained unchanged at 1.11%.
States that saw the largest quarterly increases in their overall delinquency rates in the third quarter included Arizona (29 basis points), Louisiana (28 basis points), Indiana (28 basis points), Iowa (26 basis points), and Texas (24 basis points).
Photo: Andy Beales