Mortgage Delinquencies Decline in Q3 of 2021

According to the Mortgage Bankers Association’s (MBA) latest National Delinquency Survey (NDS), the delinquency rate for mortgage loans on one-to-four-unit residential properties decreased to a seasonally adjust rate of 4.88% of all loans outstanding in Q3 of 2021. For the purposes of the survey, MBA asks servicers to report loans in forbearance as delinquent if the payment was not made based on the original terms of the mortgage. The delinquency rate was down 59 basis points from Q2 of 2021 and down 277 basis points from one year ago.

In a statement prepared for the release of the Q3 NDS, Marina Walsh, CMB, MBA’s Vice President of Industry Analysis said, “For the fifth consecutive quarter, the mortgage delinquency rate declined, commensurate with a decline in the U.S. unemployment rate over the same time period. The improvement was driven entirely by a decline in later-stage delinquent loans — those loans that are 90 days or past due, but not in foreclosure. By the end of the third quarter, many borrowers were approaching the 18-month expiration point of their forbearance terms and were being placed in permanent home retention solutions, such as modifications and loan deferrals.”

“Once these borrowers entered permanent post-forbearance workouts and resumed payments, they moved from delinquent to current status,” Walsh added.