Nothing is worse for a local neighborhood than “zombie” homes. These are homes that are usually foreclosures or homes that are way behind in their mortgage payments. If these owners can’t afford to pay their mortgage, then they cant afford to keep the house looking nice either which creates a “blight” or stigma in that local neighborhood.
So, it is great news that the Mortgage Bankers Association is reporting that mortgage delinquencies are at their lowest levels since 1979, no…not 1997….1979!
MBA’s National Delinquency Survey showed that the delinquency rate for mortgage loans on one- to four-unit residential properties fell to a seasonally adjusted rate of 3.77% of all closed loans. The rate was down 20 basis points from Q3 2019 and 29 basis points from Q4 2018. The share of loans in the process of foreclosure in the fourth quarter was only 0.21%.
Marina Walsh, vice president of industry analysis at MBA, said “Mortgage delinquencies track closely to the US unemployment rate, and with unemployment at historic lows, it’s no surprise to see so many households paying their mortgage on time,” and that “Signs of healthy conditions were seen in other parts of the survey. The foreclosure inventory rate (the percentage of loans in the foreclosure process) was at its lowest level since 1985. Furthermore, states with lengthier judicial processes continued to chip away at their foreclosure inventories, and it also appears that with home-price appreciation and equity accumulation, distressed borrowers have had alternative options to foreclosure.”