Recent reports have emerged that delinquency rates for commercial and multifamily mortgage loans continually declined until the third quarter of this year. As per the World Property Journal, these reports were released by the Mortgage Association, under their Commercial/ Multifamily Delinquency Report.
As per the MBA's Vice President of Commercial Real Estate Research, Jamie Woodwell:
"Commercial and multifamily mortgages are performing very well, delinquency rates for loans held by life companies, Fannie Mae and Freddie Mac are all hovering near zero. Among loans held by banks, the delinquency rate for multifamily loans is now lower than it has been since the series began in 1993, and the delinquency rate for mortgages backed by other commercial properties is down to levels seen before the most recent recession".
Their analysis delved deeper at the commercial/multifamily delinquency rate of commercial banks and thrifts, commercial mortgage backs securities, life insurance companies, Fannie Mae, and Freddie Mac as these are five of the major investor groups. These groups are the ones responsible for holding more than 80 percent of commercial/multifamily mortgage debt outstanding.
As per the data that was reported by the website, it was based on the unpaid principal balance of loans. The delinquency rates of each group by the end of the third quarter are listed below:
- Banks and thrifts (90 or more days delinquent or in non-accrual): 0.82 percent, a decrease of 0.08 percentage points from the second quarter of 2015;
- Life company portfolios (60 or more days delinquent): 0.04 percent, a decrease of 0.02 percentage points from the second quarter of 2015;
- Fannie Mae (60 or more days delinquent): 0.05 percent, unchanged from second quarter of 2015.
- Freddie Mac (60 or more days delinquent): 0.01 percent, unchanged from second quarter of 2015;
- CMBS (30 or more days delinquent or in REO): 4.84 percent, a decrease of 0.15 percentage points from the second quarter of 2015;
These may be for the third quarter, as per the Mortgage Orb however Commercial/Multifamily delinquencies continually decline in Q1 which was dated back in June as reported by the MBA.
