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Mortgage Defaults Hit 18-Year High

NEW YORK CITY-Although Q1 increases were the smallest in more than a year, defaults are on pace to hit a new peak, RCA says.

By Paul Bubny | Updated on May 23, 2010

NEW YORK CITY-The default rate for commercial mortgages is now the highest since 1992 and is likely to surpass the previous record, according to an analysis of bank and FDIC data by Real Capital Analytics. However, the quarterly rise in volume of commercial mortgage defaults is the smallest in a year.

At the end of the first quarter of 2010, the default rate stood at 4.17%, or $45.5 billion, up 192 basis points year over year and second only to the 4.55% record set in 1992. By year’s end, it’s projected to surpass the ’92 record and peak at 5.4% in 2011, according to RCA.

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