by Calculated Risk on 6/28/2019 04:13:00 PM

Fannie Mae reported that the Single-Family Serious Delinquency rate decreased to 0.70% in May, from 0.72% in April. The serious delinquency rate is down from 1.03% in May 2018.

These are mortgage loans that are "three monthly payments or more past due or in foreclosure". 

The Fannie Mae serious delinquency rate peaked in February 2010 at 5.59%.

This is the lowest serious delinquency rate for Fannie Mae since July 2007.

Click on graph for larger image

By vintage, for loans made in 2004 or earlier (3% of portfolio), 2.57% are seriously delinquent. For loans made in 2005 through 2008 (4% of portfolio), 4.36% are seriously delinquent, For recent loans, originated in 2009 through 2018 (93% of portfolio), only 0.32% are seriously delinquent. So Fannie is still working through a few poor performing loans from the bubble years.

The increase late last year in the delinquency rate was due to the hurricanes - there were no worries about the overall market.

I expect the serious delinquency rate will probably decline to 0.4 to 0.6 percent or so to a cycle bottom.

Note: Freddie Mac reported earlier.