Mortgage delinquency rate rising

January 20, 2020

Apparently slightly more Canadian homeowners are slipping behind in their mortgage obligations, perhaps a reflection of the higher consumer debt load. The 90-day-plus delinquency rate for mortgages rose to 0.18 per cent in the third quarter of 2019. That’s a 6.7 per cent increase compared to a year earlier, according to Equifax.
Non-mortgage debt delinquencies were up 9.7 per cent in Q3 to 1.15 per cent. That’s the highest third-quarter reading since 2012.
“While the uptrend in delinquencies has been relatively modest, it has been masked by a significant increase in consumer bankruptcies,” said Bill Johnston, vice-president of data and analytics at Equifax Canada. “Consumer proposals, where a licensed insolvency trustee negotiates debt repayments, remain on a strong rising trend and that is coming at the expense of traditional delinquencies.”
The Equifax data shows the average consumer now carries about $72,500 in debt, up 2.1 per cent compared to a year earlier. Non-mortgage debt rose just 1.5 per cent to $23,800, which marks a “significant slowing from recent trends,” Equifax noted.
In total, Canadians owed $1.966 trillion in consumer credit as of the third quarter of 2019, up 4.1 per cent from the same period in 2018.