Delinquency Ratio = Total Amount Owed (delinquent) ÷ Gross Potential Monthly Income. Healthy stabilized facilities run ~5% or less. That 5% typically reflects normal late payers who also generate late fees. Above that, tighten up collections and move to auction sooner.
Red flags: High ratios often come from weak collections and payment plans. Don’t allow payment plans. If reports show double‑digit delinquency, verify auction pipelines and manager follow‑through. Protect your cash flow by watching this ratio every month.
