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Black Knight: Foreclosure Starts Pull Back; Delinquencies Edge Higher
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Black Knight, Jacksonville, Fla., said foreclosure starts fell in July and remain well below pre-pandemic levels, while early-stage delinquencies edged up.
The company’s monthly First Look Mortgage Monitor said the national delinquency rate edged up to 2.89% in July – driven by a 4% increase in early-stage delinquencies – but remains just 14 basis points higher than the record low set in May of this year. Serious delinquencies – loans 90 or more days past due, but not yet in active foreclosure – pulled back in July after worsening for the first time in 22 months in June.
The report said seriously delinquent loans curing to current has dropped steadily over recent months, from 104,000 in March to 58,000 in July, indicating that the easiest workouts have likely been completed.
Meanwhile, foreclosure starts fell back 25% from June to 17,700, 55% below pre-pandemic levels for a July – equating to just 3% of 90+ day past-due loans. Though still up from record lows that came from widespread moratoriums and forbearance protections last year, the number of loans in active foreclosure declined slightly by 6K in July.
The report said prepayment activity dropped by another 18% in July and is now down by 67% from the same time last year as rising rates put downward pressure on both purchase and refinance lending.