CHICAGO– Mortgage lending increased as refinancing accelerated, but more borrowers fell behind on payments, with Federal Housing Administration loans accounting for nearly half of seriously delinquent mortgages, according to TransUnion.
The company’s third-quarter 2026 Mortgage Credit Industry Insights Report showed mortgage originations rose 12.8% from a year earlier to about 1.5 million in the second quarter. Separately, the share of mortgage accounts at least 60 days past due reached 1.71% in the third quarter, up 20.3% from a year earlier.
The report draws on TransUnion’s U.S. consumer credit database. Its origination figures cover the second quarter, while its latest delinquency and outstanding balance measures cover the third quarter.
Refinancing Leads Growth
Loans to purchase homes increased 7.1% from a year earlier to 1.16 million. Purchases nevertheless fell to 78.5% of mortgage originations as refinancing grew faster.
Rate-and-term refinancing, which changes a mortgage’s interest rate or repayment term, rose 60% to about 125,000 loans. Cash-out refinancing, which allows homeowners to borrow against equity, increased 30% to about 194,000 loans.
Purchase originations increased across all credit risk tiers, TransUnion reported. Thirty-year loans accounted for 87.3% of all mortgage originations.
New mortgage balances rose 17.5% from a year earlier, and the average balance on a newly originated mortgage increased by approximately $13,000. Total outstanding mortgage balances reached $13.1 trillion, up 2.8%.
Home Equity Borrowing Expands
Home equity originations, a category that includes cash-out refinancing, home equity lines of credit and home equity loans, increased 13.5% from a year earlier. Balances on those new accounts reached $113.9 billion, led by cash-out refinancing.
Cash-out refinancing and home equity line originations grew sharply in the second quarter, while home equity loan volume was flat, according to the report.
TransUnion estimated tappable home equity at roughly $22 trillion, up about 3% from a year earlier. Its measure limits borrowing to 80% of a property’s value, subtracts existing mortgage and home equity balances, and covers homeowners with credit scores of at least 620.
FHA Delinquencies Rise
The overall serious delinquency rate exceeded its third-quarter 2019 level of 1.58%, though it remained well below the 7.32% recorded in the third quarter of 2009.
For FHA loans, the share at least 60 days past due reached 5.60%, up from 4.09% a year earlier and 3.36% in the third quarter of 2019.
FHA loans represented 47.2% of mortgages at least 60 days delinquent, the highest concentration in more than 20 years, TransUnion said.
