Providing more evidence that the housing market is returning to normal, the share of past-due residential mortgages declined in the third quarter to a seasonally adjusted rate of 6.5%, according to the Mortgage Bankers Association. Although this is the lowest rate recorded since the second quarter of 2008, the share of residential mortgages that are past due is still about 2 percentage points higher than the 1980-1999 average.
The number of mortgages that are past due declined 14.8% in the third quarter; it was the 13th consecutive quarterly drop in the number of past-due mortgages.
The Mortgage Bankers also report that the total number of mortgage loans being serviced (the sum of the number of loans that are past due and the number of loans that are whole), has fallen on a year-over-year basis for 20 consecutive quarters. This may reflect tighter lending requirements or the growing prevalence of all-cash home purchases