OCC Reports Mortgage Performance for Fourth Quarter of 2025

The Office of the Comptroller of the Currency (OCC) has released its Mortgage Metrics Report for the fourth quarter of 2025, highlighting a stable performance for first-lien mortgages within the federal banking system. According to the report, 97.5 percent of tracked loans remained current and performing, reflecting a marginal year-over-year improvement from 97.4 percent in 2024. These findings are critical for the residential mortgage sector as they provide a snapshot of credit quality and servicer activity across approximately 19.2 percent of all outstanding residential mortgage debt in the United States.

The OCC’s data reveals that the vast majority of the 10.3 million loans in the federal banking system are performing well, with the current and performing rate rising slightly to 97.5 percent at the end of 2025. Serious delinquencies, which include loans 60 or more days past due and those held by bankrupt borrowers whose payments are at least 30 days late, remained unchanged compared to the fourth quarter of 2024. This stability suggests a resilient borrower base despite broader economic shifts, covering a significant $2.6 trillion in total principal balances across the residential sector.

Servicing activity showed mixed results regarding foreclosure and loss mitigation efforts during the final months of 2025. While servicers initiated 7,519 new foreclosures during the quarter—a decrease from the third quarter of 2025—this figure represents an increase when compared to the same period a year earlier. Meanwhile, completed mortgage modifications saw a sharp decline, falling 39 percent from 8,190 in the previous quarter to just 5,888. The OCC specifically attributed this reduction in modification volume to changes in loss mitigation programs implemented by secondary market investors.

Of the modifications that were completed, the vast majority were designed to enhance long-term affordability through multiple interventions. Approximately 94.5 percent, or 5,565 actions, were categorized as 'combination modifications,' which typically involve a mix of interest rate reductions and term extensions to ensure loan sustainability. These metrics provide essential context for the residential mortgage market, illustrating how shifts in investor policy and servicer behavior directly impact the tools available for preventing defaults and maintaining loan performance across the federal banking system.