With the peak impact of last year’s hurricanes finally subsiding, the performance of U.S. mortgages improved. Government-insured performance improved more than it ever has.
America’s book of single-family loans ended the first quarter of this year with 5.79 percent of all mortgages either at least 30 days past due or in the foreclosure inventory.
The rate, presented in the
Mortgage Bankers Association’s National Delinquency Survey Q1 2018, was improved from 6.36 percent at the end of last year. On the same date in 2017, the non-current rate worked out to 6.10 percent.|
“The strong economy, low unemployment rate, tax refunds and bonuses and home price appreciation were key factors that helped push delinquencies down in the first quarter,” MBA Vice President of Industry Analysis Marina Walsh explained in an accompanying announcement. “Of course, there are offsetting factors that may put upward pressure on delinquency rates in future quarters, including: a difficult recovery for some borrowers in hurricane-impacted states; the aging of loan portfolios; higher interest rates that limit a borrower’s rate-term refinance options; higher energy prices; stretching of housing affordability given limited supply; and the easing of credit overlays as mortgage market conditions have changed.”
The trade group noted that it reports loans as delinquent even when forbearance is in place — as is the case with some hurricane-impacted mortgages..
On just conventional loans, the non-current rate was 4.84 percent, while it was
10.77 percent on loans insured by the Federal Housing Administration and 5.21 percent on transactions guaranteed by the Department of Veterans Affairs.
Overall delinquency reflected a 30-day rate, excluding foreclosures, of 4.63 percent, sinking from 5.17 percent at the end of the fourth-quarter 2017 and improved from 4.71 percent at the end of the first quarter of last year.
Walsh noted, “Mortgage delinquencies decreased from the previous quarter across all loan types — conventional, VA, and in particular, FHA –as the effects of the September hurricanes dissipated.”
MBA said that FHA’s 136-basis-point plunge marked the largest single
quarter-over-quarter decline ever for its survey.
Overall 30-day delinquency was highest in Mississippi at 7.57 percent. After that was 6.74 percent in Louisiana, followed by Florida’s 6.59 percent, Alabama’s 5.72 percent and Texas’ 5.62 percent.
“Both Texas and Florida appear to be past the peak delinquencies that immediately followed the hurricanes,” the report said.
At 2.03 percent, Washington had the lowest 30-day rate of any state as of the first-quarter 2018.
Also comprising the U.S. non-current rate was a foreclosure inventory rate of 1.16 percent. The rate improved 3 basis points from the prior quarter and 23 BPS from a year prior.
New York’s 3.45 percent foreclosure rate was the highest in the nation. Next was New Jersey’s 3.33 percent, then 2.57 percent in Maine, 2.14 percent in Hawaii and 1.96 percent in Connecticut.
With a foreclosure rate of just 0.30 percent, Colorado’s was the lowest of all states.
