Commercial mortgages, especially multifamily, outperformed all other loan types in 2010 after reporting lower delinquency rates and fewer charge-offs on bad mortgage debt, the Mortgage Bankers Association said Thursday. Last year, banks and thrifts charged off 1.22% of their entire commercial mortgage balance. Charge-off rates indicate what portion of a lender's existing loan balance will be classified as bad debt since borrowers are unlikely to repay the loans. In addition, only 1.24% of the institutions' multifamily loan balances were classified as bad debt. Comparatively, banks and thrifts had to charge off 1.7% of their commercial and industrial loans, 1.89% of their family residential loans and 2.05% of their individual loans in 2010. Construction loans fared among the worst with the same institutions reporting a charge-off rate of 5.45% within that segment. "Commercial and multifamily mortgages provide security to their lenders in that even when under stress except in the most extreme situations, the commercial property generally continues to provide some level of income to help pay its debt service," the MBA said in its data report. When comparing loan types on a dollar-by-dollar basis, banks and thrifts lost $145 billion writing off troubled single-family mortgages in the past four years. During the same period, the institutions lost only $26 billion covering bad debt associated with commercial mortgages. The multifamily segment fared even better with only $6 billion in charge offs. While single-family mortgages had a fourth-quarter delinquency rate of 9.97%, commercial and multifamily mortgages maintained delinquency rates of 5.33% and 4.84%, respectively. Those rates also fell from the first quarter of 2010 when banks and  thrifts reported delinquency rates in the 5.64% - 5.93% range. Construction loans, once again, took a bigger hit with a delinquency rate of 17.98%. The MBA reported similar results in its March 2010 report, which covered calendar year 2009. Write to Kerri Panchuk.