//October mortgage delinquency rate reaches 18-year low

October mortgage delinquency rate reaches 18-year low

The strong economic headwinds from last fall facilitated a declining loan delinquency rate across the country, though areas hit by natural disasters had increased defaults, according to CoreLogic.

The national mortgage delinquency rate fell to 4.1% in October, down year-over-year from 5.1% and a step below September 2018’s 4.4%.

“Despite some regional spikes related to hurricane- and fire-impacted areas, overall delinquency rates are near or at historic lows,” Frank Martell, president and CEO of CoreLogic, said in a press release.

Delinquencies drop

The foreclosure inventory rate, measuring loans in some stage of foreclosure, remained in its holding pattern of 0.5% since April and inched down by 0.1 percentage point from a year ago. The serious delinquency rate dropped to 1.5% from 1.9% year-over-year, marking the lowest level for any October since 2006.

The share of mortgages that transitioned from current to 30 days past due decreased to 0.8% in October from 1.1% the year prior. Just before the housing crisis, the transition rate was 1.2% in January 2007 and reached an apex of 2% in November 2008.

Despite October being a positive month for borrowers nationwide, 18 metro areas experienced increases in delinquency rates. Of them, seven were in either North Carolina or South Carolina — a continued impact from Hurricane Florence.

“While the strong economy has helped families stay current and push overall delinquency rates lower, areas that were hit hard by natural disasters have seen a rise in loan defaults,” Frank Nothaft, chief economist for CoreLogic, said in a press release.

“The 30-day delinquency rate in the Panama City, Fla., metro area tripled between September and October 2018 as a result of Hurricane Michael. Two months after Hurricane Florence made landfall in the Carolinas, 60-day delinquency rates doubled in the Jacksonville, Wilmington, New Bern and Myrtle Beach metro areas. And buffeted by Kilauea’s eruption in the Hawaiian Islands, serious delinquency rates jumped on the Big Island by 9% between June and October 2018, while falling by 4% in the rest of Hawaii,” Nothaft continued.

Original Source