US Commercial Mortgage Delinquency Rates Decline in Q2

On Thursday, the Mortgage Bankers Association (MBA) released its latest Commercial Real Estate Finance Loan Performance Survey, showing that commercial mortgage delinquency rates declined across most major property types and capital sources in Q2.

Office and lodging properties continued to have the highest delinquency rates. Among capital sources, commercial mortgage-backed securities recorded the highest level, with 4.82% of loan balances 30 or more days delinquent, down from 5.21% in Q1.

Delinquency rates for other capital sources remained comparatively low. Life company loan delinquencies fell to 1.19% from 1.47%, while the rate for government-sponsored enterprise loans rose to 1.11% from 0.97%. The FHA loan delinquency rate edged up to 1.06% from 0.96%.

Commenting on the report, MBA Associate Vice President of Commercial Real Estate Research Reggie Booker said:

“Commercial mortgage loan performance improved during the second quarter, with delinquency rates declining across most major property types and capital sources. While office and lodging properties continue to face challenges and CMBS delinquency rates remain elevated relative to other lenders, the overall decline in non-current loan balances points to continued stability in the commercial mortgage market.”