Commercial, Multifamily Mortgage Delinquencies Decline in U.S.
2015-04-21
According to the Mortgage Bankers Association's Commercial-Multifamily Delinquency Report, delinquency rates for commercial and multifamily mortgage loans continued to decline in the second quarter of 2014.
"Commercial and multifamily mortgage performance continues to strengthen," said Jamie Woodwell, MBA's Vice President of Commercial Real Estate Research. "Delinquency rates for loans held by Fannie Mae and Freddie Mac all remain low and delinquency rates for CMBS loans continue to decline. Among loans held on bank balance sheets, the 30-90 day delinquency rate is now the lowest in the series history, going back to 1993."
The second quarter 2014 delinquency rate for commercial and multifamily mortgages held in life insurance company portfolios was 7.45 percentage points lower than the series high. The delinquency rate for multifamily loans held by Freddie Mac was 6.79 percentage points lower than the series high. The delinquency rate for multifamily loans held by Fannie Mae was 3.52 percentage points below the series high. The rate for commercial and multifamily mortgages held by banks and thrifts was 5.18 percentage points lower than the series high. The rate for loans held in CMBS was 3.31 percentage points below the series high.
The MBA analysis looks at commercial/multifamily delinquency rates for five of the largest investor-groups: commercial banks and thrifts, commercial mortgage-backed securities, life insurance companies, Fannie Mae, and Freddie Mac. Together these groups hold more than 80 percent of commercial/multifamily mortgage debt outstanding.
Construction and development loans are not included in the numbers presented here. The analysis incorporates the same measures used by each individual investor group to track the performance of their loans. Because each investor group tracks delinquencies in its own way, delinquency rates are not comparable from one group to another.
Based on the unpaid principal balance (UPB) of loans, delinquency rates for each group at the end of the second quarter were as follows:
• Life company portfolios: 0.08 percent (60 or more days delinquent);
• Freddie Mac: 0.02 percent (60 or more days delinquent);
• Fannie Mae: 0.10 percent (60 or more days delinquent);
• • CMBS: 5.71 percent (30 or more days delinquent).Banks and thrifts: 1.40 percent (90 or more days delinquent or);
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