Pleasanton Weekly

Real Estate - June 24, 2011

Delinquency rates vary among investor groups

Commercial-backed securities stay high in 1st quarter

by Jeb Bing

Delinquency rates among different commercial and multifamily mortgage investor groups were mixed in the first quarter of 2011, according to the Mortgage Bankers Association.

The delinquency rate for loans held in commercial mortgage-backed securities (CMBS) reached the highest level since the series began in 1997, but the climb was slower than in recent quarters. Delinquency rates for other groups remain below levels seen in the last major real estate downturn during the early 1990s, some by large margins.

Between the fourth quarter of 2010 and first quarter of 2011, the 90-plus day delinquency rate on loans held by FDIC-insured banks and thrifts remained the same at 4.18%. The 30-plus day delinquency rate on loans held in CMBS increased 0.23 percentage points to 9.18%.

The 60-plus day delinquency rate on loans held in life company portfolios decreased 0.05 percentage points to 0.14%. The 60-plus day delinquency rate on multifamily loans held or insured by Fannie Mae decreased 0.07 percentage points to 0.64%.

The 60-plus day delinquency rate on multifamily loans held or insured by Freddie Mac increased 0.10 percentage points to 0.36%.

The first quarter 2011 delinquency rate for commercial and multifamily mortgages held by banks and thrifts was 2.40 percentage points lower than the series high (6.58%, reached in the second quarter of 1991). The rate for loans held in CMBS was a record high for the series.

The delinquency rate for commercial and multifamily mortgages held in life insurance company portfolios was 7.23 percentage points lower than the series high (7.37%, reached during the fourth quarter of 1993); the rate for multifamily loans held by Fannie Mae was 2.98 percentage points lower than the series high (3.62%, reached during the fourth quarter of 1991); and the rate for multifamily loans held by Freddie Mac was 6.45 percentage points lower than the series high (6.81%, reached in 1992).

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