For the month of September, 3.9% of all mortgages in the U.S. were in some stage of delinquency (30 days or more past due, including those in foreclosure), representing a 2.4-percentage point decrease compared to September 2020, when it was 6.3%. Comparatively, the overall delinquency rate in September 2019 was 3.8%.
To gain a complete view of the mortgage market and loan performance health, CoreLogic examines all stages of delinquency. In September 2021, the U.S. delinquency and transition rates, and their year-over-year changes, were as follows:
- Early-Stage Delinquencies (30 to 59 days past due): 1.1%, down from 1.5% in September 2020.
- Adverse Delinquency (60 to 89 days past due): 0.3%, down from 0.7% in September 2020.
- Serious Delinquency (90 days or more past due, including loans in foreclosure): 2.4%, down from 4.2% in September 2020.
- Foreclosure Inventory Rate (the share of mortgages in some stage of the foreclosure process): 0.2%, down from 0.3% in September 2020. This remains the lowest foreclosure rate recorded since 1999.
- Transition Rate (the share of mortgages that transitioned from current to 30 days past due): 0.6%, down from 0.8% in September 2020.
Mortgage delinquency continued to decline in September, while home equity has soared, according to CoreLogic’s most recent Home Equity Report. Despite nearly one-in-two delinquent borrowers being behind on their mortgages by six months or more, high levels of equity assure that relatively few of these borrowers will fall into foreclosure as they exit forbearance. Additionally, the U.S. unemployment rate has continued to fall over the course of the year and in November 2021 was 4.2%, 10.6 percentage points lower than the rate in April 2020. Employment and income growth provide the means for borrowers to remain current on their mortgages.
“Record home equity levels have been a boon to many homeowners navigating the cross currents of the pandemic,” said Frank Martell, president and CEO of CoreLogic. “Not only have homeowners used this equity to fuel a record level of home improvements and renovation, it has proven to be a vital factor in helping families ward off foreclosure, pay down existing debt and weather changing market conditions.”
“The economic recovery has pushed down the percent of delinquent borrowers to the lowest level since the pandemic began,” said Dr. Frank Nothaft, chief economist at CoreLogic. “The number of borrowers past due on their mortgage doubled between March and May 2020. The past due rate in September 2021 was the lowest since March 2020.”
Methodology
The data in The CoreLogic LPI report represents foreclosure and delinquency activity reported through September 2021. The data in this report accounts for only first liens against a property and does not include secondary liens. The delinquency, transition and foreclosure rates are measured only against homes that have an outstanding mortgage. Homes without mortgage liens are not subject to foreclosure and are, therefore, excluded from the analysis. CoreLogic has approximately 75% coverage of U.S. foreclosure data.
