ACES: Rate of Defects in Mortgage Loans Jumped 6 Percent in Q2

MortgageOrb | By Michael Bates

Published December 15, 2022

The rate of critical defects in mortgage loans post-closing increased 6% in the second quarter, compared with the first quarter, driven in part by “geopolitical and macroeconomic events,” according to the lates ACES Quality Management Mortgage QC Industry Trends Report.

“The geopolitical and macroeconomic events surrounding the second quarter are most certainly the driving factors behind the increase in the overall critical defect rate past the 2 percent threshold,” says Nick Volpe, president of ACES, in the report. “While the Income/Employment category improved tremendously this quarter, significant defect increases in the Loan Documentation, VA and USDA categories are cause for concern.”

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