Mortgage foreclosure rate lowest since 2003
The mortgage foreclosure rate has dropped to a more normal rate. This was the major point in a report recently issued by the Mortgage Bankers Association.
“The delinquency rate for mortgage loans on one-to-four-unit residential properties decreased to a seasonally adjusted rate of 4.77 percent of all loans outstanding at the end of the fourth quarter of 2015. This was the lowest level since the third quarter of 2006.
“The delinquency rate decreased 22 basis points from the previous quarter, and 91 basis points from one year ago, according to the Mortgage Bankers Association’s National Delinquency Survey, released at the association’s National Mortgage Servicing Conference and Expo 2016 in Orlando, FL.
“The delinquency rate includes loans that are at least one payment past due but does not include loans in the process of foreclosure.”
The report specified the type of loans that were most affected by the reduced number of foreclosures.
“The percentage of loans on which foreclosure actions were started during the fourth quarter was 0.36 percent, a decrease of two basis points from the previous quarter, and down 10 basis points from one year ago. This foreclosure start rate was at the lowest level since the second quarter of 2003.
“The percentage of loans in the foreclosure process at the end of the third quarter was 1.77 percent, down 11 basis points from the third quarter and 50 basis points lower than one year ago. This was the lowest foreclosure inventory rate seen since the third quarter of 2007.”
The report included a comment by Marina Walsh, MBA’s Vice President of Industry Analysis:
“The overall delinquency rate fell to pre-recession levels and at 4.8 percent, was lower than the historical average of 5.4 percent for the time period 1979 to 2015. The rate at which new foreclosures were started decreased to 0.36 percent, the lowest rate since 2003 and only onefourth of the record high level during the worst of the foreclosure crisis in the third quarter of 2009.”