Mortgage Delinquency & Default Rates: Recent Trends and Six-Month Forecast
Indicator Overview: Delinquencies occur when borrowers fall behind on payments; defaults occur when loans become seriously delinquent or result in foreclosure. Despite higher rates, mortgage delinquencies remained near historic lows in 2025 thanks to low unemployment and prudent underwriting, though certain segments such as FHA loans saw slight upticks.
Six-Month Trend: Over the last six months, delinquency rates have inched up from record lows as inflation squeezed household budgets. Defaults remain contained, with serious delinquencies concentrated in a few economically stressed regions.
Six-Month Forecast: With economic growth expected to cool and unemployment projected to rise modestly, mortgage stress indicators may increase slightly but should stay below long-term averages. Analysts forecast delinquency rates of roughly 2.5–3 % by mid-2026, with defaults concentrated in markets facing employment headwinds.
Note: The 6-month trends chart is included on the Real Estate Market Indicators page. Please view there for the latest chart.
