The most recent overall mortgage delinquency rate was 3.93% at the end of the second quarter of 2025, according to the Mortgage Bankers Association (MBA). While this overall rate saw a slight decrease, there are shifting trends within loan types, with government-backed FHA and VA loan delinquencies rising over the past few years, contrasting with strong performance in conventional loans.
Key Metrics (as of Q2
2025):
- Overall Delinquency Rate: 3.93%
- Foreclosure Actions Started: 0.17%
- Loan Type Performance:
- Conventional Loans: Performing well
with delinquencies near record lows.
- FHA & VA Loans: Experiencing a rise in delinquencies.
Why this Matters:
- Shifting Composition:
Even with a stable overall
rate, the increase in serious delinquencies for some loan types indicates
potential future stress.
- Historic Context:
The current delinquency rate
remains below the historic average dating back to 1979.
- Economic Indicators:
The trends in mortgage delinquencies provide insights into broader economic health and housing market stability, according to a Forbes article.
As of the second quarter of 2025, the seasonally adjusted mortgage delinquency rate in the U.S. was 3.93%, according to the Mortgage Bankers Association (MBA). This rate reflects all loans that are at least one payment past due, but does not include properties in the process of foreclosure.
Key takeaways from the report
released in August 2025:
- The delinquency rate of 3.93% was a slight
decrease from the first quarter of 2025 (4.04%) and a minor decrease from
the same period one year ago (3.97%).
- Despite the low overall rate,
"serious delinquencies"—loans that are 90 or more days past due
or in foreclosure—increased in the second quarter.
- The overall delinquency rate is still
below the historical average of 5.21% since the survey's inception in
1979.
- Conventional loans performed well, with
delinquency rates near record lows. In contrast, government-backed loans,
particularly those from the Federal Housing Administration (FHA) and
Department of Veterans Affairs (VA), saw higher delinquency rates.
- The percentage of loans entering the foreclosure process fell to 0.17% in the second quarter of 2025, down from 0.20% in the first quarter.
Serious delinquency rates by
loan type
According to the MBA, the
following non-seasonally adjusted "serious delinquency" rates were
reported for Q2 2025:
- Conventional loans: 1.15% (down from
1.19% in Q1 2025).
- FHA loans: 8.74% (down from 10.57% in
Q1 2025).
- VA loans: 4.12% (down from 4.32% in Q1 2025).
A tale of two markets
While the overall delinquency
picture remains stable due to strong performance among conventional and
pre-2020 loans, the market is showing signs of weakness.
- Conventional loans: Mortgage holders
with conventional loans are generally in a strong position, especially
those who secured low rates before 2022. Their performance continues to be
solid.
- Government-backed loans: FHA and VA loans, which serve borrowers with lower down payments, have higher delinquency rates and are an area of concern for analysts.
Economic context
Several factors in 2025 point
toward potential future challenges for homeowners:
- Slowing job market: Signs of a
softening labor market could make it harder for some borrowers to make
payments if they lose their jobs.
- Other consumer debt: Rising
delinquencies in other consumer credit areas, such as auto loans and
credit cards, indicate that some households are under financial stress.
- VA program end: The expiration of a voluntary VA foreclosure moratorium at the end of 2024, without a replacement program in place, could lead to more foreclosures for certain military veterans.
https://www.google.com/search?q=what+is+the+current+mortgage+default+rate+in+the+us+2025
Comments
Mortgage payment Delinquency for late payments are affecting 3.93% of mortgage loans. The Mortgage Foreclosure Rate is 1.17%. I bought my first home in 1966 by paying $750 in back taxes owed by the owner and assuming the owner’s loan balance of $16,000. This was a 30-year conventional loan with interest at 4%. My house payment was $150 per month.
Norb Leahy, Dunwoody GA Tea Party Leader
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