Mortgage delinquencies fall to their lowest January in 20 years

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With a strong job market and low interest rates, the mortgage delinquency rate fell to its lowest January level in at least 20 years. The trend is expected to continue through 2019, according to CoreLogic's Loan Performance Insights Report.

The overall mortgage delinquency rate fell to 4% in January from 4.9% the year prior and from 4.1% in December. Early-stage delinquencies edged down annually to 1.9% from 2% and the foreclosure inventory rate went to 0.4% from 0.6% year-over-year, tying the lowest monthly level since 2000.

"Income growth, home appreciation and sound underwriting combined have pushed delinquency rates to their lowest level in 20 years," Frank Nothaft, chief economist for CoreLogic, said in a press release.

"The low delinquency rates on home mortgages are a contrast to the rising delinquency rates on consumer credit. While home mortgage delinquency rates are at, or are near, their lowest levels in two decades, delinquency rates for auto and student loans are higher now than they were during the early and mid-2000s."

The share of mortgages 60-89 days past due declined 0.1 percentage points to 0.7%. The serious delinquency rate — mortgages 90 or more days past due, including foreclosures — dipped to 1.4% from 2.1% year-over-year. Serious delinquencies went down to its lowest monthly rate since September 2006.

"As the economic expansion continues to create jobs and low mortgage rates support home buying this spring, delinquency rates are likely to trend lower during the coming year," said Frank Martell, president and CEO of CoreLogic. "The decline in delinquency rates has occurred in nearly all parts of the nation."

As mortgage health improved year-over-year for 13 straight months, natural disasters caused delinquency rates to rise in metro areas mostly in the Southeast U.S.

A total of 13 housing markets areas saw annual increases in serious delinquency rates. Panama City, Fla., had the highest increase of 2.4 percentage points. It was followed by Albany, Ga., with a 1 percentage point rise and Jacksonville, N.C., with a 0.8 percentage point increase.

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Foreclosures Mortgage defaults Natural disasters Distressed CoreLogic