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**Commercial Mortgage Delinquency Rates Decline in Q3, Says MBA**
Commercial mortgage delinquency rates saw an overall decline in the third quarter of 2025, following a significant rise during Q2, according to the Mortgage Bankers Association (MBA). The total balance of commercial mortgages that are not current also decreased during the period. However, the report notes that certain capital sources and specific property types experienced increasing delinquency levels.
“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 Vice President of Commercial Real Estate Research. “It is worth watching this portion of the market the rest of the year amidst broader economic uncertainty.”
Among property types, multifamily and healthcare sectors ended Q3 with higher delinquency rates. In contrast, late-pay rates for office, industrial, retail, and lodging properties showed improvements.
When examining capital sources, Commercial Mortgage-Backed Securities (CMBS) had the highest delinquency rate, rising 52 basis points to 5.66% for the quarter. On the other hand, government-sponsored enterprises Fannie Mae and Freddie Mac recorded the lowest delinquency rates, at 0.64% and 0.79% respectively.
The MBA’s findings reflect a mixed outlook on the state of commercial real estate debt, highlighting the ongoing variability across different property types and capital sources amid economic uncertainty.
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