Mortgage Delinquencies Increase in Q1 2025

Mortgage delinquencies continued to grow in the first few months of 2025. According to the Mortgage Bankers Association’s National Delinquency Survey, the percentage of mortgage loans past due on one-to-four-unit residential properties rose to a seasonally adjusted 4.04% by the end of Q1 2025. This is an increase of six basis points from the previous quarter and 10 basis points compared with the same time last year. Additionally, the share of loans entering foreclosure during the first quarter grew by five basis points to 0.20%.

“There were mixed results for mortgage performance in the first quarter of 2025 compared to the end of 2024. Delinquencies on conventional loans increased slightly, while mortgage delinquencies on FHA and VA loans declined,” said Marina Walsh, CMB, MBA’s Vice President of Industry Analysis. “Foreclosure inventories increased across all three loan types, and particularly for VA loans. Despite certain segments of borrowers having difficulty making their mortgage payments, the overall national delinquency and foreclosure rates remain below historical averages for now.”

Added Walsh, “The percentage of VA loans in the foreclosure process rose to 0.84 percent, the highest level since the fourth quarter of 2019. The increase from the previous quarter marks the largest quarterly change recorded for the VA foreclosure inventory rate since the inception of MBA’s survey in 1979.”