By the Numbers

Mortgage delinquencies rise led by the weakest credits

| October 16, 2026

This material is a Marketing Communication and does not constitute Independent Investment Research.

Mortgage delinquencies continued to climb through September especially among borrowers with weaker credit. FHA and VA loans originated in 2025 appear to be performing worse than earlier vintages at comparable seasoning, with the 2026 vintage following a similar path. Non-QM delinquencies also increased, led by the 2023 and 2024 vintages. Conventional and prime jumbo delinquency rates remain low relative to other loan types.

  • FHA delinquencies rose across vintages
  • 2025 FHA and VA DQs are rising faster than earlier vintages
  • 2023 non-QM delinquencies approach 9.0%

GOVERNMENT LOANS

The 2025 vintage is nearly 8.0% delinquent by at least 60 days, versus less than 6.0% DQ for the 2024 vintage at comparable seasoning. Delinquencies, already above 12.0%, edged higher for the 2022 vintage and topped 10.0% for the 2023 vintage.

Exhibit 1. FHA %D60+ ($1.6T outstanding)

Note: Deadline for restarting student loan payments without being considered delinquent, suspended since Covid, arrived Oct 1, 2024. As of October 2026 factors.
Source: Ginnie Mae, Santander US Capital Markets

Rural housing delinquencies also rose, generally by more than FHA delinquencies. DQ rates remain below FHA levels because the program does not require trial payment plans before loss mitigation.

Exhibit 2. Rural Housing %D60+ ($98B outstanding)

Note: Rural housing borrowers must have income below 115% of area median income. As of October 2026 factors.
Source: Ginnie Mae, Santander US Capital Markets

The 2025 VA vintage is more than 4.0% delinquent, matching the 2023 vintage’s current rate.

Exhibit 3. VA %D60+ ($1.1T outstanding)

Note: VA borrowers typically have stronger credit performance than FHA borrowers; these loans usually offer lower interest rates than conventional loans, which attracts borrowers who could qualify for a conventional loan. As of October 2026 factors.
Source: Ginnie Mae, Santander US Capital Markets

FANNIE MAE, FREDDIE MAC

Conventional delinquency rates remain stable and well below those of government loans, reflecting higher credit scores and larger down payments.

Exhibit 4. Conventional %D60+ ($6.5T outstanding)

As of October 2026 factors.
Source: Fannie Mae, Freddie Mac, Santander US Capital Markets

PRIVATE MBS

Delinquencies in the worst-performing vintage, 2023, rose again last month to nearly 9.0%. The 2024 vintage also deteriorated. The 2025 vintage, however, is outperforming earlier vintages at comparable seasoning.

Exhibit 5: non-QM %D60+ ($150B outstanding)

Note: Non-QM (Non-Qualified Mortgage) borrowers typically do not qualify for agency underwriting. For example, a borrower might qualify using bank statements to document assets, while being unable to qualify using traditional income documentation like tax returns or paystubs. As of September 2026 remits.
Source: Cotality, Santander US Capital Markets

Prime jumbo delinquencies remain low, though 2023 DQs now slightly exceeds 2022 DQs. Both are approaching 2.0%, roughly twice the rate of the worst-performing conventional vintage.

Exhibit 6: Prime Jumbo %D60+ ($131B outstanding)

As of September 2026 remits.
Source: Cotality, Santander US Capital Markets

Brian Landy, CFA
brian.landy@santander.us
1 (646) 776-7795

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