Mortgage Delinquencies On the Rise
Key Takeaways:
- Over 70% of U.S. household debt is mortgage-related, totaling more than $12.9 trillion.
- Southern states where incomes are generally lower are seeing the highest share of delinquencies.
- Rising insurance costs and mortgage rates are key factors contributing to homeowners' inability to make monthly mortgage payments.
With rising insurance costs, high mortgage rates, and home prices sitting at all-time highs, many homebuyers are finding themselves unable to make their monthly mortgage payments. According to a recent report from Construction Coverage, the 30-day mortgage balance delinquency rate surged to 3.68% in Q-2 2025. Comparatively, the 30-day mortgage balance delinquency rate during the COVID-19 pandemic dropped as low as 1.39%.
Consumer debt is up across the board, but mortgages remain the main driver of household debt
Total household debt is growing, but mortgage loans still make up a majority of homeowners’ debts. As of Q-2 2025, mortgage loans account for more than 70% of all U.S. household debt, totaling more than $12.9 trillion.
Aside from mortgage debt, auto loans and student loans make up the next largest share of debt, with each accounting for just 9% of total consumer debt. Credit card debt stands at approximately 6.6%, while HELOCs and other loan types make up the remaining 2.2% of total debt.
Where has the mortgage delinquency rate risen the most?
Mortgage delinquency rates tend to be highest in areas with higher levels of unemployment and lower wages. Many of the states with the highest share of mortgage delinquencies are in the South. Louisiana, Mississippi, and West Virginia are the top three states for both 30-day and 90-day mortgage delinquencies. The delinquency rates in these states are 5.89%, 5.7%, and 4.5%, respectively.
Meanwhile, the West Coast has the lowest share of mortgage delinquencies
At the opposite end of the spectrum, the West Coast has the lowest share of mortgages more than 30 days delinquent, with Washington, Oregon, and California all reporting rates of delinquent mortgages under 2%.
Mortgage delinquencies have been on the rise over the last few quarters
- Mortgage Delinquencies Creep Upward: In March, mortgage delinquencies grew year-over-year by 14%.
- Mortgage Delinquencies Increase in Q-1 2025: In the first quarter of 2025, the mortgage delinquency rate grew to 4.04%.
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