CoreLogic report reveals positive trend in mortgage performance, with serious delinquencies at a 15-year low
For the first time in six months, the overall delinquency rate fell from a year earlier, reaching 2.8% in February.
According to a new report by CoreLogic, this positive trend indicates that the vast majority of borrowers remain financially resilient enough to make timely payments.
“The US delinquency rate fell from a year earlier for the first time in six months in February, indicating that mortgage performance remains strong,” said Molly Boesel, principal economist at CoreLogic. “The decrease in delinquencies was driven by the decline in the share of mortgages that were six months or more past due, a number that has been consistently shrinking and fell to its lowest level in 15 years in February.”
The report examined all stages of delinquencies, with the year-over-year changes as follows:
- Early-stage delinquencies (30 to 59 days past due) increased slightly to 1.5%, up from 1.4% in February 2023.
- Adverse delinquency (60 to 89 days past due) remained steady at 0.4%.
- Serious delinquency (90 days or more past due, including loans in foreclosure) decreased to 0.9%, a significant drop from 1.2% in the previous year and well below the August 2020 high of 4.3%.
- The foreclosure inventory rate was consistent year-over-year at 0.3%.
Boesel noted that as later-stage delinquencies decrease, "the share of mortgages in foreclosure remained at 0.3% in February, where it has been since March 2022 and only slightly higher than the all-time low."
While most Americans with a mortgage are still able to make their payments on time, with nearly all stages of delinquency remaining near historic lows in February, four states posted small year-over-year overall delinquency rate increases, the fewest since late summer 2023.
Additionally, CoreLogic highlighted that substantial home equity growth, which was up by $1.3 trillion (8.6%) on an annual basis in the fourth quarter, "should provide many with a financial cushion that will help them avoid falling into foreclosure."
In terms of metro areas, 56 cities posted increases in overall year-over-year delinquency rates in February, with Kahului-Wailuku-Lahaina, Hawaii, seeing the largest increase of 1.6 percentage points.
Three metro areas posted an annual increase in serious delinquency rates (90 days or more late on a mortgage payment), led by Kahului-Wailuku-Lahaina, Hawaii, with a 1.6 percentage point increase.
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