Commenting on the decrease, Douglas G. Duncan, MBA's chief economist, says, "In the first quarter, we see some leveling off of delinquencies as energy prices have subsided and low interest rates have sparked a mortgage origination and refinance wave. The spike in delinquencies came in the fourth quarter of 2000, when rising energy prices cut into homeowners' disposable income and ability to pay."

Also, loans on which foreclosure began during the first quarter rose one basis point to 0.31% while those in foreclosure and the end of the quarter moved up five basis points to 0.90%. Conventional loans in foreclosure at the end of 1Q rose seven bps to 0.67%, the percentage of FHA loans in foreclosure increased 7 bps to 1.73% while VA loans declined 2 bps to 1.17%.

On a smaller sample, the survey reports that the delinquency rates for fixed-rate mortgages slumped 6 basis points to 3.49% and 18 bps to 5.64% for adjustable-rate mortgages.