Overall commercial mortgage delinquency rates declined in the third quarter of 2025 after rising significantly in Q2, the Mortgage Bankers Association reported. The overall balance of commercial mortgages that are not current also decreased. However, some capital sources and some property types saw delinquencies increase in Q3.
“Compared to the first quarter, third-quarter delinquency rates were up, driven by increases in later-stage delinquencies and foreclosure/REO properties,” said Judie Ricks, MBA’s associate VP of commercial real estate research. “It is worth watching this portion of the market the rest of the year amidst broader economic uncertainty.”
Multifamily and healthcare properties both ended Q3 with higher delinquencies, while late-pay rates receded for office, industrial, retail and lodging properties. Among capital sources, CMBS recorded the highest delinquency rate, with a 52-basis-point quarterly increase to 5.66%. Fannie Mae and Freddie Mac had the quarter’s lowest delinquencies at 0.64% and 0.79%, respectively.
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