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WASHINGTON, D.C. -
Delinquency rates continued
to tick up in the third
quarter for most
commercial/multifamily
mortgage investors, but
remained at the low end of
their historical ranges,
according the third quarter
Commercial/Multifamily
Delinquency Report from the
Mortgage Bankers Association
(MBA).
"The frozen credit markets
and deteriorating economic
conditions are placing
increased pressure on the
performance of commercial
and multifamily mortgages,"
said Jamie Woodwell, MBA's
Vice President of Commercial
Real Estate Research.
"Commercial/Multifamily
mortgages have not seen the
same kind of deterioration
in performance witnessed
among other real estate
loans, and at the end of the
third quarter, delinquency
rates for every investor
group remained at the lower
end of their historical
ranges. That being said,
delinquency rates for nearly
every investor group did see
increases during the third
quarter, and economic and
credit market stress is
likely to continue that
trend."
Between the first and second
quarters, the 30+ day
delinquency rate on loans
held in commercial
mortgage-backed securities
(CMBS) rose 0.10 percentage
points to 0.63 percent. The
60+ day delinquency rate on
loans held in life company
portfolios rose 0.03
percentage points to 0.06
percent. The 60+ day
delinquency rate on
multifamily loans held or
insured by Fannie Mae rose
0.05 percentage points to
0.16 percent. The 60+ day
delinquency rate on
multifamily loans held or
insured by Freddie Mac fell
0.02 percentage points to
0.01 percent. The 90+day
delinquency rate on loans
held by FDIC-insured banks
and thrifts rose 0.29
percentage points to 1.47
percent.
The MBA analysis looks at
commercial/multifamily
delinquency rates for five
of the largest
investor-groups: commercial
banks and thrifts,
commercial mortgage-backed
securities (CMBS), life
insurance companies, Fannie
Mae and Freddie Mac.
Together these groups hold
more than 80 percent of
commercial/multifamily
mortgage debt outstanding.
The analysis incorporates
the same measures used by
each individual investor
group to track the
performance of their loans.
Because each investor group
tracks delinquencies in its
own way, delinquency rates
are not comparable from one
group to another
Based on the unpaid
principal balance of loans (UPB),
delinquency rates for each
group at the end of the
second quarter were as
follows:
-
CMBS: 0.63 percent (30+
days delinquent or in
REO)
-
Life company
portfolios: 0.06
percent (60+days
delinquent)
-
Fannie Mae: 0.16
percent (60 or more days
delinquent)
-
Freddie Mac: 0.01
percent (60 or more days
delinquent)
-
Banks and thrifts: 1.47
percent (90 or more days
delinquent or in
non-accrual)
To put these numbers in
context, of 35,135
commercial/multifamily loans
in life company portfolios,
with a total unpaid
principal balance of $253
billion, only 36 loans with
an aggregate UPB of less
than $144 million were 60+
days delinquent at the end
of the quarter. Of $1.2
trillion of
commercial/multifamily
mortgages at FDIC-insured
banks and thrifts, only $18
billion was 90+ days
delinquent.
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