Mort­gage Delin­quen­cies Show Im­prove­ment

National Mortgage News - - Servicing - By Bon­nie Sin­nock

Late pay­ments on sin­gle-fam­ily home mort­gages im­proved on a con­sec­u­tive quar­ter ba­sis as more re­cov­ery from Hur­ri­canes Har­vey and Irma took hold, but more po­ten­tial loan per­for­mance con­cerns lie ahead. Over­all, sea­son­ally ad­justed delin­quen­cies in the first quar­ter de­clined by 54 ba­sis points from the pre­vi­ous quar­ter but were just 8 ba­sis points lower than the same pe­riod in 2017, ac­cord­ing to the Mort­gage Bankers As­so­ci­a­tion.

“Mort­gage delin­quen­cies de­creased from the pre­vi­ous quar­ter across all loan types — con­ven­tional, VA, and in par­tic­u­lar, FHA — as the ef­fects of the Septem­ber hur­ri­canes dis­si­pated,” Ma­rina Walsh, the MBA’s vice pres­i­dent of in­dus­try anal­y­sis, said in a press re­lease. “The strong econ­omy, low un­em­ploy­ment rate, tax re­funds and bonuses and home price ap­pre­ci­a­tion were key fac­tors that helped push delin­quen­cies down in the first quar­ter.”

But for the time be­ing, even the later-term delin­quen­cies and de­faults that were up in fourth quar­ter of 2017 look to have im­proved on a con­sec­u­tive quar­ter ba­sis. Most no­tably, the delin­quency rate for FHA loans plum­meted. The 136-ba­sis-point con­sec­u­tive quar­ter im­prove­ment in the delin­quency rate for FHA loans recorded in the first quar­ter marked the largest sin­gle-quar­ter de­cline ever seen in the MBA’s Na­tional Delin­quency Sur­vey.

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