In December 2024, 17% of delinquent FHA purchase loans came from the 2023-2024 vintages, showing an increase from 10% in 2019. Serious delinquencies on FHA loans rose from 3.7% in Q2 2024 to 4.8% in February 2025, aligning with 2017 delinquency rates. Rising debt-to-income ratios were investigated but deemed not responsible for the increase. While the GSEs have taken on a larger share of high-LTV loans, this did not contribute to the delinquency rise. FHA loans with higher credit scores have also increased, indicating a mixed borrower profile.
In December 2024, 17% of delinquent FHA purchase loans were from 2023-2024 vintages, up from 10% in 2019 for 2018-2019 vintages.
Seriously delinquent FHA loans increased from 3.7% in Q2 2024 to 4.8% in February 2025, tracking with levels seen in 2017.
Rising debt-to-income (DTI) ratios have shifted among mortgage borrowers, but were found not to be the reason for the delinquency uptick.
From 2017 to 2024, the share of FHA loans with DTI ratios of 50% or higher grew from 21% to 31%.
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