Wednesday, September 28, 2022
Delinquency rates are increasing at a fairly slow but steady rate. The overall delinquency percentage on 20MM FNMA/GNMA loans increased from 2.78% in March to 3.03% today (25 basis points). There are two points of additional concern:
1) As the index graph above shows, there is a wide dispersion of results by FICO band. Low FICO loan deliquency rates have increased 15% over these six months. Credit stress tends to start with the lower credit loans. Whether it spreads to the higher bands is a possible concern.
2) While total delinquencies are up 25bps, the "feeder" group (1 and 2 pays delinquent) are up 44 basis points.
No point for alarm yet, but we will be watching this trend closely.
Our team is hands-on and knowledgeable, reach out to us for any consultation needs or questions.