by Calculated Risk on 4/25/2022 08:05:00 AM
Note: At the beginning of the pandemic, the delinquency rate increased sharply. Loans in forbearance are counted as delinquent in this survey, but those loans are not reported as delinquent to the credit bureaus. Foreclosures are starting to increase following the end of the moratorium, but are at very low levels (see: Delinquencies, Foreclosures and REO) for a discussion of rising foreclosures, and why this isn’t a concern)
o While March typically sees the strongest mortgage performance of any month – with delinquencies falling more than 10% on average over the past 20 years – this year’s 15.5% reduction was exceptionally strong
o Robust employment, continued student loan deferrals, strong post-forbearance performance and millions of refinances into record-low interest rates have all helped put downward pressure on delinquency rates
o The strongest improvement was seen among borrowers who are a single payment past due, with 30-day delinquencies recording a 20% month-over-month decline
o Though serious delinquencies – those 90 or more days past due but not in foreclosure – fell 12% for the strongest single-month improvement in 20 years, they remain 70% above pre-pandemic levels
o Despite elevated serious delinquencies, foreclosure starts fell by 3% from the month prior and are holding well below pre-pandemic levels
o The number of active foreclosures edged slightly higher in March, marking the first year-over-year increase in almost 10 years, though inventories also remain well below pre-pandemic levels
o Prepayment activity bucked the recent trend of sharply rising interest rates driving falling prepay speeds, rising by 9% in March, likely driven at least in part by seasonal increases in home sales-related prepays
According to Black Knight’s First Look report, the percent of loans delinquent decreased 15.5% in March compared to February and decreased 43% year-over-year.
The percent of loans in the foreclosure process increased 3.7% in March and were up 3.9% over the last year. (First year-over-year increase in almost 10 years – but from very low levels)
Black Knight reported the U.S. mortgage delinquency rate (loans 30 or more days past due, but not in foreclosure) was 2.84% in March, down from 3.36% in February.
The number of delinquent properties, but not in foreclosure, is down 1,159,000 properties year-over-year, and the number of properties in the foreclosure process is up 7,000 properties year-over-year.
Black Knight: Percent Loans Delinquent and in Foreclosure ProcessMar
2020Delinquent2.84%3.36%5.02%3.39%In Foreclosure0.32%0.31%0.30%0.42%Number of properties:Number of properties
that are delinquent,
but not in foreclosure:1,513,0001,783,0002,672,0001,792,000Number of properties
pre-sale inventory:169,000162,000162,000220,000Total Properties1682,0001,946,0002,834,0002,013,000