US Mortgage Delinquency Rate Drops in 2023Q1—Lowest Q1 Since 1979

The Mortgage Bankers Association (MBA) released on Thursday (5-11-23) its National Delinquency Survey (NDS) for mortgage loans on one-to-four-unit residential properties. According to the report, the delinquency rate on such properties decreased to a seasonally adjusted rate of 3.56% of all outstanding loans at end of 2023Q1.

The NDS reports that the delinquency rate was down 40 basis points from 2022Q4 and was down 55 basis points year-over-year. The percentage of loans on which foreclosure actions were started in Q1 inched 2 basis points higher to 0.16%.

Adding additional background and her analysis of the NDS, MBA’s Marina Walsh, CMB, Vice President of Industry Analysis, said”

“The mortgage delinquency rate fell to its lowest level for any first quarter since MBA’s survey began in 1979 and was the second lowest quarterly rate overall, just 11 basis points above the survey low in third quarter of 2022. Mortgage delinquencies and unemployment rate continue track each other closely, with unemployment rate in April falling back to the 54-year low of 3.4% set in January.”

MBA’s forecast calls for an economic slowdown and an increase in unemployment later this year and into next year. Looking forward, Walsh noted that the end of COVID-19 forbearance programs means some distressed borrowers may be offered different forbearance and loss mitigation options than those given during the pandemic.