For the month of February, 5.7% 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 2.1-percentage point increase in the overall delinquency rates compared to February 2020. The slight (0.1 percentage point) increase over January 2021 marks the first uptick in month-to-month national delinquency since August 2020.
To gain an accurate view of the mortgage market and loan performance health, CoreLogic examines all stages of delinquency. In February 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): 1.5%, down from 1.8% in February 2020.
- Adverse Delinquency (60 to 89 days past due): 0.5%, down from 0.6% in February 2020.
- Serious Delinquency (90 days or more past due, including loans in foreclosure): 3.7%, up from 1.2% in February.
- Foreclosure Inventory Rate (the share of mortgages in some stage of the foreclosure process): 0.3%, down from 0.4% in February 2020.
- Transition Rate (the share of mortgages that transitioned from current to 30 days past due): 0.9%, unchanged from February 2020.
Government support throughout the pandemic, and improving employment rates, have enabled more borrowers to remain current on their mortgages than would otherwise have occurred. With a more optimistic economic outlook, consumer sentiment has improved. In fact, according to a recent CoreLogic consumer survey, 8 in 10 respondents indicated they were unlikely to fall behind on their mortgage payment based on their current financial situation.
“Overall delinquency ticked up slightly in February, but the serious delinquency and foreclosure rates continued a sequential monthly decline that began in August,” said Frank Martell, president and CEO of CoreLogic. “Consumer confidence continues to rise as the economy roars back to life. These factors bode well for housing fundamentals in 2021 and as far as the eye can see”
“Some families that had overspent during the year-end holiday season, and then faced financial stress in the new year, may slip behind on a mortgage payment by February,” said Dr. Frank Nothaft, chief economist at CoreLogic. “During each of the last five years, the 30-day delinquency rate moved higher from January to February. With economic conditions improving, we expect delinquency rates to move lower in coming months.”
State and Metro Takeaways:
- All U.S. states and nearly all metro areas logged increases in annual overall delinquency rates in February.
- Hawaii and Nevada (both up 4 percentage points) again logged the largest annual increase in overall delinquency rates in February.
- Among metros, Odessa, Texas, still recovering from job losses in the oil industry, had the largest annual overall delinquency increase with 9.9 percentage points.
- Other metro areas with significant overall delinquency increases included Midland, Texas (up 7.7 percentage points); Kahului, Hawaii (up 6.5 percentage points) and Lake Charles, Louisiana (up 6.2 pe rcentage points).
The next CoreLogic Loan Performance Insights Report will be released on June 8, 2021, featuring data for March 2021. For ongoing housing trends and data, visit the CoreLogic Insights Blog: www.corelogic.com/insights.
The data in The CoreLogic LPI report represents foreclosure and delinquency activity reported through February 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.
About the CoreLogic Consumer Housing Sentiment Study
3,000+ consumers were surveyed by CoreLogic via Qualtrics. The study is an annual pulse of U.S. housing market dynamics concentrated on consumers looking to purchase a home, consumers not looking to purchase a home, and current mortgage holder. The survey was conducted in April 2021 and hosted on Qualtrics.
The survey has a sampling error of ~3% at the total respondent level with a 95% confidence level.