Multi-Family/Commercial Delinquency Rates Show Improvement in Q4

Commercial and multi-family delinquency rates of 60+ days decreased in the fourth quarter for all five major investor groups that hold the loans, but were up on an annual basis for loans held in CMBS and by Banks and Thrifts. The Mortgage Bankers Association (MBA) said that several of the rates were cut in half compared to the fourth quarter of 2011.

During the fourth quarter of 2012 the 60+ day delinquency rate for loans held in life company portfolios decreased to 0.8 percent from 0.12 percent in the third quarter and from 0.17 percent in the fourth quarter of 2012.  Loans held or insured by Freddie Mac dropped from 0.12 percent in the third quarter and 0.17 percent at the end of 2011 to 0.08 percent.  Fannie Mae saw similar improvement with its rate down from 0.28 percent in the third quarter to 0.24 percent, less than half the 0.59 percent rate one year earlier.

Commercial and multi-family loans held by FDIC insured banks and thrifts had a 60+ day delinquency rate of 2.62 percent at the end of the fourth quarter of 2012.  This was down from 2.94 percent at the end of the third quarter but was an increase of 4 basis points from the Q4 2011 rate.  Loans held in CMBS were down 13 basis points from the third quarter to 8.73 percent which was an increase from the 8.56 percent recorded one year earlier.

The five investor groups together hold more than 80 percent of outstanding commercial/multifamily mortgage debt.   MBA said that because each investor group tracks delinquencies in its own way, group to group comparisons are not appropriate.