The share of recent Fannie Mae mortgages with payments late by three months or more decreased, arriving close to a threshold that hasn’t been crossed since the coronavirus arrived in the United States, a recent report shows.
Ninety-day-plus delinquencies on loans originated between 2009 and 2021, which Fannie purchased, fell to 1.08% in November 2021; down from 1.17% the previous month and 2.48% a year ago.
Prior to COVID-19’s arrival, in March 2020, the percentage was 0.35%.
While continued improvement is uncertain due to
Fannie also tracks the performance of older loans, but
While Fannie’s housing forecast does not include projections for mortgage delinquencies, its economic outlook does include some estimates for the unemployment rate, which is generally correlated with loan performance.
Last month, Fannie projected that unemployment will drop from recent levels above 4% to its pre-pandemic low near 3.5% by the fourth quarter of 2021. At its height during the pandemic, it approached 15%.
Some experts predict that Omicron will briefly weaken the economy and employment as 2022 gets underway but that a rebound will occur later, as was the case with the Delta variant.
“As the Omicron wave passes, and hopefully passes through quickly here, we’ll bounce right back hopefully in the spring quarter of 2022,” Mark Zandi, chief economist at Moody’s Investors Service, told CNN in a recent interview.
