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Black Knight: National Mortgage Delinquency Rate Decreased in August

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by Calculated Risk on 9/22/2021 04:34:00 PM

Note: At the beginning of the pandemic, the delinquency rate increased sharply (see table below). Loans in forbearance are counted as delinquent in this survey, but those loans are not reported as delinquent to the credit bureaus.

From Black Knight: Black Knight: With Moratoria Lifted, Foreclosure Starts Edge Higher, But Still 80% Below Pre-Pandemic Levels; Delinquency Rate Falls to 4% For First Time Since Early 2020

o The national delinquency rate on first lien mortgages fell to 4.00% in August, the lowest it’s been since pandemic-related impacts caused mortgage delinquencies to spike in early 2020

o Serious delinquencies – including those in active forbearance – fell by 108,000 from July and, though down by more than 1 million from last August, are still roughly 930,000 above pre-pandemic levels

o August’s 7,100 foreclosure starts represented the largest such volume in eight months after foreclosure moratoria on federally backed loans were lifted at the end of July

o Despite the increase – which was driven primarily by restarting the process on loans that had been in foreclosure prior to the moratoria – start volumes remain 80% below August 2019 levels

o Though the number of loans in active foreclosure saw the first monthly rise of 2021 (+2,000), volumes remain near record lows and are still down 44% (-97,000) from pre-pandemic levels

o Prepayment activity rose by nearly 9% in the month with interest rates – which have held below 3% in recent months – continuing to spur both refinance and purchase activity

emphasis added

According to Black Knight’s First Look report, the percent of loans delinquent decreased 3.5% in August compared to July, and decreased 42% year-over-year.

The percent of loans in the foreclosure process increased 1.7% in August and were down 24% over the last year.

Black Knight reported the U.S. mortgage delinquency rate (loans 30 or more days past due, but not in foreclosure) was 4.00% in August, down from 4.14% in July.

The percent of loans in the foreclosure process increased in August to 0.27%, from 0.26% in July.

The number of delinquent properties, but not in foreclosure, is down 1,557,000 properties year-over-year, and the number of properties in the foreclosure process is down 45,000 properties year-over-year.

Black Knight: Percent Loans Delinquent and in Foreclosure Process Aug
2021July
2021Aug
2020Aug
2019Delinquent4.00%4.14%6.88%3.45%In Foreclosure0.27%0.26%0.35%0.48%Number of properties:Number of properties
that are delinquent,
but not in foreclosure:2,122,0002,206,0003,679,0001,818,000Number of properties
in foreclosure
pre-sale inventory:142,000140,000187,000253,000Total Properties2,264,0002,346,0003,867,0002,066,000

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