Seasonally adjusted delinquencies for certain government-insured or guaranteed home loans underwent the steepest plunge seen in the history of the Mortgage Bankers Association’s survey during the second quarter, when late payments also experienced broader declines.
The consecutive-quarter drop to 12.77% from 14.67% for Federal Housing Administration-insured loans, and to 6.47% from 7.62% for Department of Veterans Affairs-guaranteed mortgages occurred as overall delinquencies fell to 5.47% from 6.38%, marking a low not seen since the first quarter of last year.
Like FHA and VA loans, mortgages late by 90 days or more experienced a record decline, falling 72 basis points to 3.53% between the first and second quarters. A year ago, the seasonally adjusted overall delinquency rate for the second quarter was 8.22%. The equivalents for FHA and VA loans, respectively, were 15.65% and 8.05%.
The fact that marked declines were seen even in loans that have had
“It appears that borrowers in later stages of delinquency are recovering due to several factors, including improved employment and other economic conditions, the availability of home retention workout options after forbearance, and a strong housing market that is bringing additional alternatives to distressed homeowners,” said Marina Walsh, the MBA’s vice president of industry analysis, in a press release.
Any loan where the borrower did not make the payment as contractually obligated, including forborne mortgages, was treated as delinquent for the purposes of this survey. Foreclosures were excluded from delinquency rates. The association has been tracking delinquency rates since 1979.
