Q3 NY Fed Report: Mortgage Originations by Credit Score, Foreclosures Increase Slightly

The NY Fed released the Q3 Quarterly Report on Household Debt and Credit this morning. Here are a few charts from the report.

The first graph shows mortgage originations by credit score (this includes both purchase and refinance). Look at the difference in credit scores in the recent period compared to the during the bubble years (2003 through 2006). Recently there have been almost no originations for borrowers with credit scores below 620, and few below 660. A significant majority of recent originations have been to borrowers with credit score above 760.

Solid underwriting is a key reason I’ve argued Don't Compare the Current Housing Boom to the Bubble and Bust, Look instead at the 1978 to 1982 period for lessons

From the NY Fed:

The volume of mortgage originations, measured as appearances of new mortgages on consumer credit reports and including both refinance and purchase originations, increased slightly with $512 billion newly originated in 2025Q3, an uptick from the $458 billion seen in the previous quarter. …

Credit quality of newly originated loans was mixed. … There was a slight decline in the credit quality of mortgages, as the median score of newly originated mortgage loans decreased by 2 points and the tenth percentile score decreased by 3 points.

Here is another way to look at the credit scores by origination over time. There was a significant decline in credit scores during the bubble.

Transition Rates for Current Mortgages

A possible concern is the recent increase in transition rates from current to 30-60 days late. This had been steadily increasing, then decreased in Q2, but increased again in Q3. This is close to pre-pandemic levels.

And here is the transition to serious delinquencies. Most short-term delinquencies transition back to current. The transition to seriously delinquent (90+ days) increased in Q3 and is something to watch.

Foreclosures Decrease

Foreclosures are still well below pre-pandemic levels. The increase over the last three quarters was likely due to the end of the VA foreclosure moratorium.

And as a “bubble” reminder, here is graph of percent new foreclosures by state (the “sand states” Nevada, California, Florida and Arizona saw that largest number of foreclosures during the housing bust). Now no state really stands out.

There is much more in the Q3 report.