Distressing mortgages fell in October: CoreLogic
While the number of distressed mortgages continued to decline month over month in October, the number of serious defaults recorded this month was three times the total seen in the same period l last year, according to CoreLogic.
The Loan Performance Insights report showed that serious defaults – loans past due 90 days or more, including foreclosures – fell to 4.1% from 4.2% the month before, but more than tripled the rate of a year ago of 1.3%. Mortgages beyond 120 days but not yet foreclosed held monthly at 3.3% but surged from 1% in October 2019.
The overall delinquency rate for October fell to 6.1% from 6.3% in September while climbing 3.7% the previous year.
“After a financially tough year, the healthy housing market and new stimulus are helping borrowers get back on their feet,” Frank Martell, President and CEO of CoreLogic, said in the report. “Given these variables, we should start to see a reduced flow of delinquent households in the coming months. “
While the latest stimulus package brings some relief to distressed homeowners, many housing experts think it’s not enough. If the government does not provide more assistance to borrowers in difficulty, serious delinquencies could double by 2022, according to a previous CoreLogic report.
The early 30 to 59 day failure rate declined slightly to 1.4% in October, from 1.5% in September and 1.8% in October 2019. The 60 to 89 day failure rate fell from 0 , 7% to 0.6% month over month, while maintaining year over year.
The foreclosure rate has remained static at 0.3% since April and has fallen by 0.4% each year while moratoriums on seizures keep it under control.
At the state level, the three highest foreclosure rates remain unchanged from a month ago, with rates of 1.2% in New York City and 0.8% in Hawaii and Maine. A total of 14 states tied for the lowest rate at 0.1%.
State totals for delinquency rates remained essentially the same as in September. Louisiana had the highest delinquency rate at 10%, followed by 9.1% in Mississippi and 8.7% in New York. Idaho had the lowest delinquency rate at 3.2%, South Dakota next came in at 3.4% while Montana and Wisconsin were tied for third at 3.5%.