CMBS loans struggle with delinquencies, bank-held loans see improvement
Loans underlying commercial mortgage-backed securities battled rising delinquency levels in the second quarter as more loans landed in foreclosure or real-estate owned status, the Mortgage Bankers Association said Monday.
At the same time, delinquency rates on commercial and multifamily mortgages dropped when looking specifically at mortgages held by Fannie Mae, Freddie Mac, and U.S. banks.
The 60+ day delinquency rate for multifamily loans held or insured by Fannie Mae declined 0.08 percentage points to 0.29%, while the 90-plus day delinquency rate for commercial/multifamily loans tied to FDIC-insured banks and thrifts fell 0.34 percentage points to 3.11%.
The 60-plus day delinquency rate for multifamily loans held or insured by Freddie Mac increased a slight 0.04 percentage points to 0.27%.
In contrast, the 30-plus day delinquency rate for loans underlying CMBS increased 0.12 percentage points to 8.97% in the second quarter.
Life insurance companies that are invested in commercial loans noted a relatively low rate of delinquencies, although the 60-plus day delinquency rate for commercial and multifamily mortgages held by insurers did increase 0.01 percentage points to 0.15%.
"Commercial and multifamily delinquency rates for life companies, Fannie Mae and Freddie Mac all remain quite low, and the delinquency rate for bank-held loans continues to decline," said Jamie Woodwell, MBA’s vice president of commercial real estate research. "The delinquency rate for loans in CMBS continues to show higher and more sustained aggregate delinquency rates, much of which is driven by the large share of these loans in foreclosure or REO."