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13 Journal GOOD NEWS, BAD NEWS FOR DELINQUENCIES A survey published by the Mortgage Bankers Association (MBA) showed that among mortgage loans on one-to-four-unit residential properties, delinquencies decreased to a seasonally adjusted rate of 7.65% of all loans outstanding at the end of this year's Q3. For the period, the delinquency rate dipped 57 basis points from Q2 and rose 368 basis points since last year at this time. Note: For the purpose of its National Delinquency Survey, MBA asks servicers to report the loans in forbearance as delinquent if the payment was not made based on the original terms of the mortgage. An estimated 3.4 million homeowners were in forbearance plans as of September 27, 2020, MBA adds. Marina Walsh, CMB, MBA's VP of Industry Analysis said that consistent with the improving labor market and all-around rebounding economy, homeowners' mortgage- paying capabilities improved in Q3. "e decrease in the mortgage delinquency rate was driven by a sharp decline in newer 30-day delinquencies and 60-day delinquencies," she said. "Particularly encouraging was the 30-day delinquency rate, which reached its lowest level since MBA's survey began in 1979." In contrast, the report showed the seriously delinquent rate (90+ days late) reached a 10-year high, rising by 5.16% in Q3. It increased 90 basis points from last quarter and increased of 335 basis points from last year. "With forbearance plans still active and foreclosure moratoriums in place until at least the end of the year," said Walsh, "many borrowers experiencing longer-term distress will remain in this delinquency category until a loss mitigation resolution is available." e percentage of loans on which foreclosure actions were started in the third quarter remained unchanged from last quarter at .03%. e delinquency rate includes loans that are at least one payment past due but does not include loans in the process of foreclosure. e report showed the lowest foreclosure inventory rate since the second quarter of 1982. It includes a breakdown of delinquency rates for conventional, VA, and FHA loans. It also details the rates at which states are recording delinquencies. For example, the reported five states with the largest decrease in overall delinquencies for Q3 are (largest to smallest) New Jersey, New York, Alaska, Florida, and Nevada. And the five states with the most substantial increases in overall delinquency, compared to 2019 Q3 were, in order, Nevada, New Jersey, Hawaii, Florida, and New York.