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Delinquencies Spike in April as Pandemic Data Rolls In
Tuesday, July 14, 2020
April's data is here, and CoreLogic is reporting that early stage
delinquencies, that is mortgages 30 to 59 days past due, soared to levels even higher than those seen in the Great Recession. That delinquency
bucket now contains 4.2 percent of active mortgages, up from 1.7 percent in
April 2019. Further, the company's Loan Performance
Report says the share of mortgages that transitioned from current to past
due reached the highest level in at least 21 years, 3.4 percent, exceeding any statistics
from the Great Recession. In January 2007, just before the start of the
financial crisis, the current- to 30-day transition rate was 1.2 percent and it
peaked in November 2008 at 2 percent. The company notes that prior to the COVID-19
pandemic, the nation's overall delinquency rate had declined for 27 consecutive
months, and serious delinquency and foreclosure rates stood at record lows.
However, the business closures and stay-at-home orders pushed unemployment rates
to the highest level in more than 80 years in April, reducing affected
homeowners' ability to make monthly mortgage payments.
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