U.S. Mortgage Delinquency Rate At A Record Low in December

Loan Performance Insights Report Highlights: December 2021

• The nation’s overall delinquency rate was 3.4% in December.
• All stages of delinquencies showed year-over-year decreases in December.

In December 2021, 3.4% of home mortgages were in some stage of delinquency (30 days or more past due, including those in foreclosure) , which was a 2.4-percentage point decrease from December 2020 according to the latest CoreLogic Loan Performance Insights Report. This is the lowest recorded overall delinquency rate in the U.S. since at least January 1999.

Overall Delinquency Rates

The share of mortgages that were 30 to 59 days past due — considered early-stage delinquencies — was 1.2% in December 2021, down from 1.4% in December 2020. The share of mortgages 60 to 89 days past due was 0.3% in December 2021, down from 0.5% in December 2020.

The serious delinquency rate — defined as 90 days or more past due, including loans in foreclosure — was 1.9% in December, down from 3.9% in December 2020. Forbearance programs have kept delinquencies from progressing to foreclosure and therefore the foreclosure inventory rate — the share of mortgages in some stage of the foreclosure process — was at a 23-year low of 0.2% in December 2021. However, the share of borrowers behind on payments by six months or more was 1.3% in December — making up roughly 40% of the overall delinquency rate.

Stage of Delinquency: Rate of Transition

In addition to delinquency rates, CoreLogic tracks the rate at which mortgages transition from one stage of delinquency to the next, such as going from current to 30 days past due (Figure 1).

The share of mortgages that transitioned from current to 30 days past due was 0.6% in December 2021 — a decrease from 0.8% in December 2020. Low transition rates indicate that while the rate of mortgages in any stage of delinquency remained elevated, fewer borrowers slipped into delinquency than at the peak of delinquency rates in 2020.

State and Metro Level Delinquencies

All states posted annual decreases in their overall delinquency rates in December 2021 as the employment picture improved across the country compared to a year earlier. Figure 2 shows the states with the highest and lowest share of mortgages 30 days or more delinquent. In December 2021, that rate was highest in Louisiana at 6.7% and lowest in Idaho at 1.7%. Idaho has had one of the strongest job recoveries in the U.S. and Louisiana has had one of the weakest. As of December 2021, Idaho had recovered all the jobs lost in March and April 2020 while Louisiana had only recovered 58% of jobs lost.

Figure 3 shows the 30-plus-day past-due rate for December 2021 for 10 large metropolitan areas. New York had the highest rate at 4.8%, and San Francisco had the lowest rate at 1.7%. Miami’s rate decreased 4.9 percentage points from a year earlier. Outside of the largest 10, all but one metro recorded a decrease in the overall delinquency rate. Nevertheless, elevated overall delinquency rates remain in some metros, including Houma-Thibodaux, Louisiana (9.6%); Pine Bluff, Arkansas (9.4%); Odessa, Texas (8.9%) and Vineland-Bridgeton, New Jersey (8.7%).

The U.S. unemployment rate declined for the sixth straight month in December 2021 to the lowest since the beginning of the COVID-19 pandemic. Meanwhile, national home prices increased by 18.5 percent year over year, helping more owners regain equity. The combination of these dynamics pushed the overall mortgage delinquency and foreclosure rates to the lowest levels that CoreLogic has recorded in more than two decades.

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