According to Fitch Rating Services, the delinquency rate for commercial MBS loans inched down again last month, despite the addition of a big multifamily mortgage to the late-payment list. The percentage of securitized commercial mortgages that were 60 days past due stood at 8.29% on October 31, down 8 basis points (bp) from a month earlier, according to Fitch. After peaking at 9.01% in July 2011, the delinquency rate slid to 8.3% in February, cranked back up to 8.65% in May, and since then, it has dropped steadily. It is now at its lowest level since December 2010, when it was 8.23%.
The amount of debt removed from Fitch’s delinquency index continued to exceed the balance of loans added, although not by much. About $1.4 billion of mortgages were resolved via liquidations, modifications, or some other type of workout in October, while $1.3 billion of loans were newly counted as delinquent.
Meanwhile, the volume of outstanding CMBS stopped shrinking, at least temporarily. Some $4.6 billion of Fitch-rated CMBS was issued in October, outweighing the $3.4 billion of bonds that paid off or defaulted. The agency now maintains ratings on $390.2 billion of bonds backed by about 31,000 commercial mortgages. The rise in that balance, which serves as the denominator when calculating the percentage of delinquent loans, helped keep the rate down.