Single-family mortgage default rates, measured as loans that are seriously delinquent, fell to 3.1% for the month of March which was the lowest rate seen since 2007. CoreLogic staffer Frank Nothaft takes a look at this decline and explains how the rate has room to decline further to 2.5% before the end of the year.
This predicted 2.5% is still higher than the "normal levels" seen between the 1950s and the Great Recession which were mostly below 2%. Normalcy is expected to be reached in two years but this does not mean the end of foreclosures:
Unfortunately, foreclosures will continue to occur as job loss, illness, and home-value declines will affect some borrowers. During the first three months of 2016, about 70 percent of loans that began foreclosure proceedings were originated prior to 2009 (Figure 2), even though these loans account for only 30 percent of loans currently outstanding.