WASHINGTON–Commercial mortgage delinquencies increased in the fourth quarter of 2024, with the exception of life company loans, which showed a slight decrease, according to Commercial Delinquency Report from the Mortgage Bankers Association.
The MBA reported that as of the end of the quarter, banks and thrifts (90 or more days delinquent or in non-accrual) had a delinquency rate of 1.26%, an increase of 0.02 percentage points from the third quarter.
Other findings, according to the MBA data:
- Life company portfolios (60 or more days delinquent) had a delinquency rate of 0.43%, a decrease of 0.03 percentage points from the third quarter.
- Fannie Mae (60 or more days delinquent) commercial loans had a delinquency rate of 0.57%, an increase of 0.01 percentage points from the third quarter.
- Freddie Mac (60 or more days delinquent) commercial loans had a delinquency rate of 0.40%, an increase of 0.01 percentage points from the third quarter.
- CMBS (30 or more days delinquent or in REO) had a delinquency rate of 5.78%, an increase of 0.63 percentage points from the third quarter.
‘Relatively Low’
“Even with certain market challenges such as low occupancy rates and the uncertain impact of return-to-office mandates in the office market, and oversupply in the multifamily property market, [commercial mortgage] delinquency rates remain relatively low from a historical perspective,” Mike Fratantoni, senior vice president and chief economist for the MBA, stated in the report. “MBA estimates that almost a trillion dollars’ worth of loans are maturing in 2025, and these maturities, coupled with more challenging economic conditions and rangebound interest rates, may result in some further increases in delinquencies if borrowers cannot successfully refinance these loans.”
