The jump from 1.4% follows a 30-basis-point jump in the thirdquarter from 1.1%. The non-accrual rate -- the percentage of loanswhere principal and interest have gone unpaid for at least 90 days-- increased to 0.9% from 0.3% in the third quarter, according toForesight's estimates.

Foresight principal Matthew Anderson tells GlobeSt.com that thecommercial mortgage sector remains much healthier than for-saleresidential, however; with the recession looming, the commercialrate probably will go at least a little higher.

"It's not at the alarming stage yet, but lenders are pullingback o the commercial side; the CMBS market is all but shut down sothe only folks left are the portfolio lenders, who were cautiousalready and have become even more cautious now, which means it's alot harder for commercial borrowers to get loans these days, posingrisks for properties in need of refinancing during 2008."