Key Takeaways
- Mortgage delinquencies rose to 1.89% in the first quarter of 2026, up from 1.77% a year earlier but far below pandemic and mortgage crisis levels.
- Monthly mortgage payments can increase with property taxes or homeowners insurance premiums through escrow.
- Draining savings, carrying high credit card balances or struggling with an escrow increase may be warning signs that a mortgage payment is harder to manage.
The delinquency rate for single-family residential mortgages at commercial banks rose to 1.89% in the first quarter of 2026, up from 1.77% a year earlier and 1.71% two years earlier, according to the Federal Reserve.
Mortgage delinquencies are still below the pandemic-era 2.68% rate of the first quarter of 2021 and far below the 11.48% peak of the mortgage crisis in the first quarter of 2010. The increase doesn’t point to a broad mortgage crisis, but it suggests that homeowner budgets have less cushion for rising expenses than they did a few years ago.
Mortgage Delinquencies Have Ticked Upward
Mortgage delinquencies were relatively stable around 1.7% from 2023 to 2025, but increased to 1.89% in early 2026.
The increase is a caution signal, not proof of a broader housing crisis, says John Monari, vice president of TruMark Credit Union’s collections department in Philadelphia.
“Delinquencies remain relatively contained, and the pressure appears concentrated among households facing higher escrow costs and tighter monthly cash flow,” says Monari. “For many, the issue is less about housing-market weakness and more about the rising cost of homeownership.”
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Escrow Costs Can Raise Mortgage Payments
Even if you have a fixed-rate mortgage, higher property taxes and homeowners insurance premiums can increase your mortgage payment. When these costs go up, you pay more in escrow, though the principal and interest part of your mortgage payment stays the same.
“For a homeowner who stretched to afford that original mortgage payment, a surprise increase caused by an escrow shortage can put that homeowner in real jeopardy,” says Brad Spurgeon, owner and CEO of Brad Spurgeon Insurance Agency Inc. in Texas City, Texas.
An escrow shortage notice can be an early warning that your monthly payment will increase. Spurgeon says it’s important to read an escrow shortage notice from your servicer as soon as it arrives so you can understand whether taxes or insurance is driving the increase, and address the cost increase rather than simply accepting and budgeting for a higher payment.
A typical escrow shortage notice tells you when you don’t have enough funds to pay your property taxes and insurance, usually when payments for them increase. The shortage amount is divided and added to your next 12 mortgage payments, or you can pay the full shortage amount to avoid adding it to your monthly payments.
Other pressures, including home repairs, increasing utility bills and a higher overall cost of living, can further strain homeowner budgets.
Warning Signs of Mortgage Trouble
Financial strain usually shows up before a missed mortgage payment in skipped savings contributions, drained emergency funds or high credit card balances.
“The first missed payment is rarely the real problem,” says Ashley F. Morgan, a debt and bankruptcy lawyer in Chantilly, Virginia. “The real problem usually started months earlier when the budget stopped working.”
Isolated setbacks can be manageable, but regularly moving money around to cover basics is a signal to reassess before you miss a payment. If you can’t see a realistic way to make mortgage payments over the next several months, start exploring options immediately instead of hoping things somehow improve on their own, says Morgan.
What To Do Before You Miss a Mortgage Payment
Don’t wait for a missed payment to address financial strain. Start by reviewing fixed monthly obligations in your budget, such as subscriptions, insurance and debt payments, to see what could be reduced or eliminated before your mortgage payment is affected.
Reviewing your mortgage statement and escrow analysis can help you identify changes in taxes or insurance. You may not be able to prevent every escrow increase, but you can look for ways to reduce the underlying costs. If property taxes are driving up your mortgage payment, check the appeal process and deadline in your county. Appealing a property tax assessment may help lower your bill if the assessed value seems too high.
You can also shop around for homeowners insurance before renewal, comparing premiums, deductibles, coverage limits and exclusions. A lower homeowners insurance premium can reduce your escrow payment.
Before you miss a mortgage payment, contact your mortgage servicer. Depending on the loan and hardship, you may have options including:
“Homeowners should contact their mortgage servicer as soon as they see a payment problem coming,” says Monari. “The biggest mistake is waiting until the loan is seriously delinquent.”
“Avoid payday loans, cash advances or tapping retirement funds without guidance,” says Monari. “Early communication creates more options and can help protect both the home and credit profile.”