CoreLogic’s latest Loan Performance Insights report shows an interactive view of its mortgage performance analysis through September 2019.
CoreLogic said measuring early-stage delinquency rates is important for analyzing the health of the mortgage market. To more comprehensively monitor mortgage performance, CoreLogic said its report examines all stages of delinquency as well as transition rates that indicate the percent of mortgages moving from one stage of delinquency to the next.
The report is published monthly with coverage at the national, state and Core Based Statistical Area (CBSA)/Metro level and includes transition rates between states of delinquency and separate breakouts for 120+ day delinquency.
“The decline in delinquency rates in North and South Carolina compared with a year ago reflect the recovery from Hurricanes Florence and Michael, which hit in the autumn of 2018,” CoreLogic Chief Economist Frank Nothaft said in the report. “Shortly after a natural disaster, we tend to see a spike in delinquency rates. Depending on the extent of devastation, serious delinquency rates generally return to their pre-disaster levels within a year.”
In September 2018, 3.8 percent of mortgages were delinquent by at least 30 days or more including those in foreclosure. This represents a 0.6 percent decline in the overall delinquency rate compared with September 2018.
No states, the report said, posted a year-over-year increase in the overall delinquency rate in September 2019. The states that logged the largest annual decreases were Mississippi (-1.1 percent), North Carolina (-1.1 percent), Louisiana (-1.0 percent), New Jersey (-1.0 percent) and South Carolina (-1.0 percent).
“In September 2019, four metropolitan areas in the Midwest and Southeast recorded small annual increases in overall delinquency rates,” CoreLogic said. “Metros with the largest increases were Dubuque, Iowa, (0.8 percent), Pine Bluff, Ark. (0.6 percent), Dalton, Ga. (0.2 percent) and Eau Claire, Wis. (0.1 percent).”
While the nation’s serious delinquency rate remains at a 14-year low, 14 metropolitan areas recorded small annual increases in their serious delinquency rates. Metros with the largest increases were Panama City, Fla. (0.7 percent), Dubuque, Iowa, (0.2 percent) and Pittsfield, Mass. (0.2 percent). The remaining 11 metro areas each logged an annual increase of 0.1 percentage point.
“The strong labor market in the United States along with continued prudent underwriting practices for mortgage origination have combined to power favorable loan performance over the past few years,” CoreLogic President and CEO Frank Martell said. “Unemployment reached a 50-year low in September 2019, which helped push annual delinquency rates downward for the 21st consecutive month and we expect this trend to continue as we enter into the New Year.”
As to loan performance (national), for September 2019, the foreclosure inventory rate was 0.4 percent, down 0.1 percent from September 2018. For the national transition rates, CoreLogic examines all stages of delinquency as well as transition rates that indicate the percent of mortgages moving from one stage of delinquency to the next.
The share of mortgages that transitioned from current to 30-days past due was 0.8 percent in September 2019, a 0.4 percent decline from September 2018. By comparison, in January 2007, just before the start of the financial crisis, the current-to-30-day transition rate was 1.2 percent and peaked in November 2008 at 2 percent.
There were no states, according to the report, that saw an annual rate increase in serious delinquency, which is defined as 90 days or more past due including loans in foreclosure. There were 14 metropolitan areas where the serious delinquency rate increased, while there were 52 metropolitan areas where the serious delinquency rate remained the same. All the remaining metropolitan areas saw the serious delinquency rate decrease.