Mortgage Delinquencies Increase Slightly in the First Quarter of 2024
Based on the MBA National Delinquency Survey data for the first quarter of 2024, the overall delinquency rate for mortgage loans on one-to-four-unit residential properties increased by 6 basis points to 3.94% on a seasonally adjusted basis. “Overall mortgage delinquencies increased slightly in the first quarter of 2024, but not across all three of the major loan types. Delinquencies declined for FHA loans, were relatively flat for conventional loans, and increased for VA loans,” said Marina Walsh, CMB, MBA’s Vice President of Industry Analysis. “Notably, all three loan types saw an increase in delinquencies compared to one year ago. Higher unemployment, lower personal savings, increases in property taxes and insurance, and a run-up in credit card debt and delinquency contributed to conditions that would make it tougher for some homeowners to make their mortgage payments.”
By product type compared to fourth-quarter 2023:
Foreclosure starts declined slightly to .46% from the previous quarter. According to Walsh, “At the end of 2023, the Department of Veterans Affairs encouraged mortgage servicers to implement a foreclosure moratorium until the end of May 2024. With this pause came an increase in VA loans that remained delinquent, but not in foreclosure inventory.” Added Walsh, “The labor market is still quite resilient with the unemployment rate – strongly correlated with mortgage performance – remaining at 3.7 percent in January. Any weakening in employment conditions would likely lead to more borrowers falling behind on their payments in the coming quarters.” The five states with the highest delinquency rates include MS, LA, AL, WV, and GA. The five states with the highest foreclosure rates include NY, LA, ME, D.C., and HI.?