Published by DSNews on August 11, 2020
U.S. mortgage performance was showing signs of sustained improvement in the months preceding the pandemic.
In May, 7.3% of mortgages were at least 30 days late, according to CoreLogic. The cause? Reverberations of the recession on loan performance.
CoreLogic’s latest Loan Performance Insights Report reveals that, compared to the same point last year, that 7.3% represents an increase of 3.7% in the overall delinquency rate.
U.S. mortgage performance was showing signs of sustained improvement in the months preceding the pandemic. In February, the national unemployment rate matched a 50-year floor. Meantime, the delinquency rate had experienced a 27 -month drop overall.
That’s when things took a turn. When COVID-19 spawned into a global pandemic by May, U.S. unemployment raced past 13%. More than 4 million homeowners—accounting for more than 8% of all mortgages—were left with little choice other than to enter into a COVID-19 mortgage forbearance plan.
As 2021 winds down, CoreLogic forecasts the U.S. serious delinquency rate to quadruple. That would propel 3 million homeowners into serious delinquency without additional government programs and support.