Fannie and Freddie: Single Family Delinquency Rate Increased in February

Key Takeaways

• Freddie Mac delinquency rose to 0.61% in February
• Fannie Mae delinquency increased to 0.60% month‑over‑month
• Both rates remain near pre‑pandemic low levels
• Delinquency peaks occurred during 2010 bubble and 2020 pandemic
• Recent loan vintage shows slight delinquency uptick

Summary

Fannie Mae and Freddie Mac reported that single‑family serious delinquency rates ticked higher in February, with Freddie Mac at 0.61% and Fannie Mae at 0.60%, each up 0.01 percentage point from January. Both metrics are essentially flat year‑over‑year and sit close to pre‑pandemic lows of around 0.60%. The data show modest increases among recent‑vintage loans while legacy 2004‑2008 vintages remain higher but stable. Mortgages in forbearance are counted as delinquent in these reports, though they are not reported to credit bureaus.

Pulse Analysis

The February delinquency figures from Fannie Mae and Freddie Mac underscore a housing‑finance market that has largely rebounded from the pandemic shock. At just over six‑tenths of a percent, serious delinquency is hovering near the 0.60% pre‑COVID baseline, suggesting borrowers are still managing payments despite lingering inflation and higher interest rates. This stability is partly attributable to forbearance programs that, while now counted as delinquent, keep borrowers out of default and off credit‑bureau reports, cushioning the immediate impact on credit scores.

Historical context adds nuance to the current numbers. The peak delinquency rates of 4.20% for Freddie Mac in 2010 and 5.59% for Fannie Mae during the same period reflect the fallout from the 2008 housing bust, while the 2020 pandemic spikes—3.17% and 3.32% respectively—showed how systemic shocks can quickly elevate risk. Today’s rates are a fraction of those highs, yet the modest month‑over‑month uptick, especially among loans originated after 2009, hints at emerging stress in newer vintages that could become more pronounced if economic conditions deteriorate.

Looking ahead, market participants will watch the delinquency trend as a leading indicator of broader credit health. Lenders may tighten underwriting standards or adjust pricing if the upward trajectory continues, while investors in mortgage‑backed securities will reassess risk models that currently assume low default probabilities. Policymakers, too, will gauge whether additional forbearance extensions are needed to prevent a resurgence of defaults. In sum, the current low‑level rise serves as a cautionary signal, prompting proactive risk management across the housing finance ecosystem.