ICE First Look: Delinquencies Up; Foreclosure Activity Slowly Trending Higher

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The national mortgage delinquency rate rose in August–largely driven by a calendar anomaly–while foreclosure activity continued its slow upward trend, ICE Mortgage Technology reported.

“The rise in the national delinquency rate for August is best understood in the context of how the calendar can impact payment processing,” said Andy Walden, head of mortgage and housing market research at ICE. “Most of the uptick in the national delinquency rate can be attributed to delayed processing of end-of-month payments, as August closed on a Sunday this year.”

Walden noted this “calendar-driven effect” is consistent with what we observed in prior years, “so the increase should be considered a temporary adjustment rather than a shift in underlying borrower health,” he said.

Key takeaways from the latest ICE First Look report include:

The national delinquency rate rose by 16 basis points in August to 3.43%, up 10 basis points from the same time last year, marking a return to annual increases after temporary reprieves in June and July.

Mortgage delinquencies typically face little seasonal pressure from July to August, but the last day of August 2025 falling on a Sunday resulted in delayed processing and temporarily higher delinquency rolls. For instance, August 2003, 2008, and 2014 also ended on a Sunday, each experiencing a delinquency rise averaging 5.3%. This is similar to the 5.0% rise observed this year, suggesting that much of August’s delinquency rise may have been driven by the way the calendar fell.

FHA loans continue to see the largest annual increases, with the non-current rate (delinquencies including foreclosures) up by 86 basis points to 12.0% in August, while the non-current rates for VA, GSE, and portfolio-held mortgages remained effectively flat year over year.

Serious delinquencies (loans 90-plus days past due but not in foreclosure) rose by 16,000 in August and are up 32,000 year over year, while loans in active foreclosure increased by 3,000 for the month and 23,000 since last year.

Foreclosure starts rose year-over-year (+6%) for the ninth consecutive month, and foreclosure sales (+22.5%) are up from the same time last year for the sixth consecutive month, contributing to a 12.3% annual increase in foreclosure inventory.

Inflows and transitions to later stages of delinquency increased across the board, while cures to current from both early- and late-stage delinquency fell.

August prepayment activity slipped by 1 basis point to a 0.66% single-month mortality rate, reflecting seasonal home buying patterns and relatively steady interest rates in July.