CoreLogic’s monthly Loan Performance Insights Report for May 2023 showed that most homeowners in the United States seem to be paying off their low-rate mortgages with ease.
For the month of May, 2.6% of all mortgages in the U.S. were in some stage of delinquency (30 days or more past due, including those in foreclosure), representing a 0.1 percentage point decrease compared with 2.7% in May 2022 and a 0.2 percentage point decrease compared with 2.8% in April 2023.
To gain a complete view of the mortgage market and loan performance health, CoreLogic examines all stages of delinquency. In May 2023, the U.S. delinquency and transition rates and their year-over-year changes, were as follows:
- Early-Stage Delinquencies (30 to 59 days past due): 1.3%, up from 1.1% in May 2022.
- Adverse Delinquency (60 to 89 days past due): 0.4%, up from 0.3% in May 2022.
- Serious Delinquency (90 days or more past due, including loans in foreclosure): 1%, down from 1.3% in May 2022 and a high of 4.3% in August 2020.
- Transition Rate (the share of mortgages that transitioned from current to 30 days past due): 0.6%, unchanged from May 2022.
- Foreclosure Inventory Rate (the share of mortgages in some stage of the foreclosure process): 0.3%, unchanged from May 2022.
The overall mortgage delinquency rate in the U.S. again fell to a historic low in May, returning to the level seen in March of this year, while the near-all-time low foreclosure rate has not changed since spring 2022.
However, 14 states and nearly 170 metropolitan areas saw overall delinquencies increase year over year in May, similar to April data. Still, despite this pattern and gradually declining U.S. home price gains over the past year, overall mortgage performance remains quite healthy, boosted by steady employment numbers.
“A very strong job market continues to help borrowers pay their mortgages on time,” says Molly Boesel, principal economist at CoreLogic. “The U.S. economy has added nearly 25 million jobs since April 2020 and about 4 million in the last year. As a result, the unemployment rate has ranged from 3.4% to 3.7% for the past 16 months. While the job market may slightly weaken over the next year, we project that mortgage performance will remain healthy.”
Three U.S. metro areas posted an increase in serious delinquency rates (90 days or more late on a mortgage payment) in May, while changes in other metros ranged between -1.3% and 0.0%. The metros that saw serious delinquencies increase were Cape Coral-Fort Myers, Fla., and Punta Gorda, Fla. (both up by 0.7 percentage points) and Elkhart-Goshen, Ind. (up by 0.2 percentage points).
