IRVINE, Calif.—Mortgage delinquencies declined in the most recently released data.
The data show 5.3% of mortgages were delinquent by at least 30 days or more (including those in foreclosure) in January 2017, a 1.1 percentage point decline in the overall delinquency rate compared with January 2016 when it was 6.4%.
The analysis was released by CoreLogic as part of its monthly Loan Performance Insights Report.
As of January 2017, the foreclosure inventory rate, which measures the share of mortgages in some stage of the foreclosure process, was 0.8% compared with 1.1% in January 2016. The serious delinquency rate, defined as 90 days or more past due including loans in foreclosure, was 2.5%, down from 3.2% in January 2016, CoreLogic said.
“Measuring early-stage delinquency rates is important for analyzing the health of the mortgage market,” the company said. “To more comprehensively monitor mortgage performance, CoreLogic examines all stages of delinquency as well as transition rates that indicate the percentage of mortgages moving from one stage of delinquency to the next.”
CoreLogic reported that early-stage delinquencies, defined as 30-59 days past due, were trending lower in January 2017 at 2.1% compared with a year ago at 2.4% in January 2016. The share of mortgages that were 60-89 days past due in January 2017 was 0.7%, down from 0.8% in January 2016.
Since early-stage delinquencies can be volatile, CoreLogic noted it also analyzes transition rates. The share of mortgages that transitioned from current to 30 days past due was 0.9% in January 2017 compared with 1.2% in January 2016. By comparison, in January 2007, just before the start of the financial crisis, the current to 30-day transition rate was 1.2% and peaked in November 2008 at 2%, the company reported.
“Steady job and income growth, combined with full-doc underwriting, has led to low early-stage delinquencies,” said Dr. Frank Nothaft, chief economist for CoreLogic, in a statement. “January’s 0.9% transition rate for current to 30 days late is lower than a year ago and much lower than the 1.5% average from 2000 and 2001, during which the foreclosure rate was, conversely, lower than it is today.”
“The 30-plus delinquency rate, the most comprehensive measure of mortgage performance, is at a 10-year low and rapidly declining,” said Frank Martell, president and CEO of CoreLogic. “While late-stage delinquencies remain in the pipeline in selected markets, early-stage delinquency performance is stellar and the lowest it’s been in two decades. The continued improvement in mortgage performance bodes well for the health of the market in 2017.”