As of January, 3.3% of all mortgages in the U.S. were in some stage of delinquency (30 days or more past due, including those in foreclosure), representing a 2.3 percentage point decrease compared to January 2021, when it was 5.6%. This is according to CoreLogic’s monthly Loan Performance Insights Report for January 2022, released this week.
This again marks the lowest recorded overall delinquency rate in the U.S. since at least January 1999.
To gain a complete view of the mortgage market and loan performance health, CoreLogic examines all stages of delinquency in its report. In January 2022, the U.S. delinquency and transition rates and their year-over-year changes, were as follows:
- Early-Stage Delinquencies (30 to 59 days past due): 1.2%, down from 1.3% in January 2021.
- Adverse Delinquency (60 to 89 days past due): 0.3%, down from 0.5% in January 2021.
- Serious Delinquency (90 days or more past due, including loans in foreclosure): 1.8%, down from 3.8% in January 2021 and a high of 4.3% in August 2020.
- Foreclosure Inventory Rate (the share of mortgages in some stage of the foreclosure process): 0.2%, down from 0.3% in January 2021.
- Transition Rate (the share of mortgages that transitioned from current to 30 days past due): 0.7%, unchanged from January 2021.
The drop in the nation’s overall mortgage delinquency rate in January marked the 10th consecutive month of year-over-year declines, according to the report. This trend can be attributed to two familiar factors: escalating home prices and a strong job market. U.S. home prices continue to reach new highs, posting 20% year-over-year growth in February. Meanwhile, the latest U.S. jobs report shows that the country added an average of 562,000 positions per month in the first quarter of 2022.
While the U.S. foreclosure rate declined compared to January 2021, the expiration of moratoriums in some states caused the number of foreclosures to rise from December 2021. Nevertheless, the January 2022 foreclosure rate was flat from December and is still the lowest recorded since at least 1999.
“The large rise in home prices—up 19% in January from one year earlier, according to CoreLogic indexes for the U.S.—has built home equity and is an important factor in the continuing low level of foreclosures,” said Dr. Frank Nothaft, chief economist of CoreLogic. “Nonetheless, there are many homeowners that have faced financial hardships during the pandemic and are emerging from 18 months of forbearance. The U.S. may experience an uptick in distressed sales this year as some owners struggle to remain current after forbearance and loan modification.”
For more information visit https://www.corelogic.com/.
