Thanks to steady improvements in the economy and rising home prices, mortgage delinquencies and foreclosures continue to drop off, according to recent analyst reports. Both the Mortgage Bankers Association (MBA) and CoreLogic are reporting that delinquency and foreclosure rates are at lows we have not seen since the financial and housing market collapse.

Takeaways:

  • Delinquency and foreclosure rates are at lows not seen since the housing market collapse.
  • The delinquency rate, which includes loans that are at least one payment past due, decreased to a seasonally adjusted rate of 5.3 percent of all loans outstanding at the end of 2Q.
  • Mortgages in serious delinquency declined by 23.3 percent year over year, the lowest seriously delinquent rate since January 2008, CoreLogic reported.

Thanks to steady improvements in the economy and rising home prices, mortgage delinquencies and foreclosures continue to drop off, according to recent analyst reports.

Both the Mortgage Bankers Association (MBA) and CoreLogic are reporting that delinquency and foreclosure rates are at lows we have not seen since the financial and housing market collapse.

mortgage-8.13.15

According to MBA’s National Delinquency Survey, nearly every state in the nation reported declining foreclosure inventory rates during the second quarter. The delinquency rate, which includes loans that are at least one payment past due, decreased to a seasonally adjusted rate of 5.3 percent of all loans outstanding at the end of the second quarter.

The association also reported that 2.09 percent of loans were in the foreclosure process at the end of the second quarter. And the percentage of loans that are seriously delinquent, or 90 days or more past due or in the process of foreclosure, was 3.95 percent, a decrease of 29 basis points from the previous quarter and a decrease of 85 basis points from second-quarter 2014.

All of these rates hit lows not seen since 2007, MBA said. Marina Walsh, MBA’s vice president of industry analysis, said the trend reflects “a nationwide housing market recovery and strong job market that provide opportunities for distressed loans to be resolved rather than be put into foreclosure.”

Andy Dean Photography / Shutterstock.com

Andy Dean Photography / Shutterstock.com

Drilling down on how these rates fared in June, CoreLogic said in its National Foreclosure Report that foreclosure inventory declined by 28.9 percent during that month, and completed foreclosures declined by 14.8 percent since the same period last year.

The number of foreclosures nationwide decreased year over year from 50,000 in June 2014 to 43,000 in June, representing a decrease of 63.3 percent from the peak of 117,119 completed foreclosures in September 2010.

The national foreclosure inventory included about 472,000, or 1.2 percent, of all homes with a mortgage, compared with 664,000 homes, or 1.7 percent, in June 2014 — marking the lowest foreclosure rate since December 2007, CoreLogic said.

Meanwhile, mortgages in serious delinquency declined by 23.3 percent year over year, the lowest seriously delinquent rate since January 2008, CoreLogic reported.

“Serious delinquency is at the lowest level in 7 1/2 years, reflecting the benefits of slow but steady improvements in the economy and rising home prices,” said Anand Nallathambi, CoreLogic’s president and CEO.

“We are also seeing the positive impact of more stringent underwriting criteria for loans originated since 2009, which has helped to lower the national seriously delinquent rate.”

Email Amy Swinderman.

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