Mortgage delinquencies trend down to end 2012

Delinquency rates declined for commercial properties.

The level of mortgage delinquencies for multifamily and other commercial buildings fell for property management companies during the fourth quarter.

Delinquencies for loans backed by government-sponsored enterprise Freddie Mac fell to 0.19 percent for the final three months of the year, according to a report from the Mortgage Bankers Association. This was 0.08 percentage points lower than the third quarter's level. Fannie Mae experienced a quarterly decline of 0.04 percentage points to a total figure of 0.24 percent. Freddie Mac's latest figure was more than 6.6 percentage points lower than the all-time high, while Fannie Mae was more than 3.3 percentage points off of its highest point.

Life insurance company portfolios had a delinquency rate of 0.08 percent during the fourth quarter for loans its held that were 60 days or more past due, the firm's Commercial/Multifamily Delinquency Report explained. This was more than 7.4 percentage points less than the highest figure ever recorded, as well as 0.04 percentage points lower than the third quarter's rate.

"The delinquency rates for commercial and multifamily mortgages dropped again in the fourth quarter," said Jamie Woodwell, vice president of commercial real estate research at MBA. "The continued decline is being driven by improving property fundamentals and a strong finance market."

Banks and thrifts insured by the FDIC experienced a delinquency rate decline of 0.32 percentage points during the fourth quarter, the report noted. This brought the figure for loans delinquent for 90 or more days to 2.62 percent. This was more than 3.9 percentage points less than the all-time high. Commercial mortgage-backed securities had a delinquency rate drop of 0.13 percentage points, and was at 8.73 percent during the final three months of the year.

Mortgage originations jump in Q4
While mortgage delinquencies continued to fall, the percentage of new mortgages made marked gains. Overall originations for both multifamily and commercial loans rose nearly 50 percent during the final three months of the year from the previous quarter, a report from MBA noted. The figure also rose by approximately the same amount from the same point in 2011.

For the entire year, mortgage originations for commercial and multifamily properties rose nearly 25 percent from 2011's totals, the report added. The fourth quarter managed to have the most significant gain in mortgage lending in five years.

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