Mortgage Delinquencies Signal What’s Next in Housing

Foreclosure rates are making headlines lately. But before you worry about another housing crash, here’s the real story.

During the housing crash from 2007 to 2011, over 9 million people went through some form of distressed sale. Compare that to last year—when there were just over 300,000. Even with the recent uptick, today’s numbers are nowhere close to what we saw during the crisis.

So, is a new foreclosure wave on the horizon? The short answer: no.

Why Mortgage Delinquencies Matter

Experts often look at mortgage delinquencies—loans more than 30 days past due—as an early signal of potential foreclosures. Right now, delinquency levels are holding steady with where they were at the end of last year. That means we’re not seeing the kind of increase that would signal widespread trouble.

But there are some trends worth watching.

Marina Walsh, Vice President of Industry Analysis at the Mortgage Bankers Association, explains:

“While overall mortgage delinquencies are relatively flat compared to last year, the composition has changed.”

Currently, FHA borrowers make up the largest share of new delinquencies.

Why FHA Loans Are More Sensitive

Borrowers with FHA mortgages may feel the effects of economic shifts more acutely—like inflation, job changes, or recession concerns. That’s why delinquency rates for FHA loans are higher than usual.

Still, if you compare the numbers to the last housing crash, there’s a big difference:

• 2008: Delinquency rates were elevated across all loan types.

• Today: FHA loans show more strain, but other loan types remain stable.

As ResiClub explains:

“The recent uptick in mortgage delinquency seems to be concentrated among FHA borrowers, however, mortgage performance remains very solid when viewed in light of the twenty-year history of our data.”

Where FHA Loans Are Most Common

FHA loans make up only about 12% of mortgages nationwide, but certain regions—particularly in the South—see a higher share of them.

The map below highlights where FHA loans are more common. It doesn’t reflect delinquency rates—just where FHA loans are concentrated. And even in those areas, delinquency levels are still far lower than what we saw in 2008.

If You’re Facing Financial Hardship

No one wants to experience foreclosure. But if you’re struggling with mortgage payments, remember you do have options:

• Reach out to your lender to ask about repayment plans or loan modifications.

• Consider selling—many homeowners today have significant equity, which could allow you to sell and avoid foreclosure altogether.

Bottom Line

Yes, foreclosures are rising slightly, but they’re nowhere near 2008 levels. And with delinquency trends holding steady, there’s no indication we’re heading for another crash.

Industry professionals are monitoring the numbers closely. If you’d like to stay informed about the latest housing updates, let’s connect so you’re always one step ahead.