The mortgage market continued to perform well in the first quarter as delinquencies declined annually for the 19th straight quarter, according to TransUnion.
The number of mortgage loans in the first quarter rose to 53.1 million from 52.8 million from the prior year, while the serious delinquency rate fell from 2.07% to 1.74%.
"Borrowers continue to perform well, making on-time payments that are more in line with traditional patterns observed prior to the mortgage crisis. It is also encouraging that balances continue to increase, as new purchase originations outpace paydowns," Joe Mellman, senior vice president and mortgage business leader at TransUnion, said in a press release.
Despite delinquencies continuing to descend, the average debt per borrower grew to $202,470 from $196,772 in the first quarter of 2017, a sign that lenders may have loosened standards somewhat. Still, lenders are likely to approach subprime borrowers hesitantly and with alternative methods for risk assessment.
"As time passes from the housing bubble and mortgage loan performance continues to remain exceptionally low, nonprime borrowers may begin to see their access to mortgage credit open up. However, it's likely that mortgage lenders will approach the nonprime market cautiously, incorporating new alternative data sources to determine which nonprime borrowers offer the least risk," Mellman said.
"We will also monitor the forbearance population in areas affected by last year's hurricanes to better understand that dynamic and its influence on the region's mortgage market," he added.
Hurricanes Harvey and Irma severely impacted the volume of mortgage accounts in forbearance, particularly in the Houston, Miami and Tampa, Fla., metropolitan statistical areas. In those cities, the number of mortgages in forbearance shot up from 1,800 to 164,000.