For the third straight month, delinquencies for commercial mortgage-backed securities experienced minimal changes, according to Fitch Ratings.

Late payments increased by only six basis points, ending May at 8.81%. In the last two years, the average monthly fluctuation was 39 bps.  

Mortgagors made $36 billion in delinquent payments last month, $1.9 billion less than the record high set in September 2010.

“There seems to be a bifurcation between loans and transactions driving the reported delinquency rate,” said Mary MacNeill, managing director at Fitch. “Adverse selection and maturity defaults are resulting in high delinquency rates to transactions issued between 1999-2001, while 2006-2008 deals suffer from performance issues.”

Loans originated between 2002 and 2004 are performing well, Fitch said, with delinquency rates ranging from 2.8% to 5.4%. Industrial, hotel, retail and office delinquency rates all saw slight month-to-month increases, while multifamily delinquencies were down to 16.37% from 16.81%.

“While delinquencies across the CMBS universe appear to be tapering off, pool concentrations and varied underwriting practices continue to expose individual transactions to the potential for future volatility,” Fitch said.

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