The number of mortgages in some stage of delinquency improved in May from last year, according to the Loan Performance Insights Report released by CoreLogic.
The overall delinquency rate for the month was 4.5%, a decline of 0.8 percentage points from the 5.3% rate in May 2016. Mortgages 30 days or more past due and those in foreclosure are included in the figure.
The share of mortgages in some stage of foreclosure also fell in May, which posted a 0.7% foreclosure inventory rate, an improvement from the 1% rate a year ago. The share of seriously delinquent mortgages, or those 90 days or more past due including loans in foreclosure, was 2%, a decrease from 2.6% for the same period in 2016. The serious delinquency rate, which is unchanged from April, was the lowest since the 2% rate recorded in November 2007.
Delinquencies 30 to 59 days past due, or early-stage delinquencies, made up 1.9% of all mortgages during the month, an improvement from the 2% share a year ago. Mortgages that were 60 to 89 days past due comprised 0.63% of the total, a decline from 0.66% in May 2016.
“Strong employment growth and home price increases have contributed to improved mortgage performance,” said Frank Nothaft, chief economist for CoreLogic. “Early-stage delinquencies are hovering around 17-year lows, and the current-to-30-day past due transition rate remained low at 0.8%. However, the same positive economic conditions helping performance have also contributed to a lack of affordable supply, creating challenges for homebuyers.”
“A prolonged period of relatively tight underwriting criteria has driven delinquencies down to pre-crisis levels across many parts of the country,” said Frank Martell, president and CEO of CoreLogic. “As pressure to relax underwriting standards increases, the industry needs to proceed carefully and take progressive, sensible actions that protect hard-fought improvements in mortgage performance.”
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