According to data from Black Knight, after last month’s spike, mortgage delinquencies rebounded strongly in October, falling 8.2% from September and nearly 18% from last year. There were 165K fewer past due loans in October than the month prior. It wasn’t just early-stage delinquencies that improved, either: seriously delinquent loans (90 or more days past due) hit a more than 12-year low after falling 14K from last month and 90K from last October. Continued improvement in hurricane-related delinquencies associated with Harvey and Irma are contributing to the strong year-over-year improvements.
Foreclosure starts did see a monthly increase, but keep in mind they were coming off of last month’s nearly 18-year low. And even with an uptick in starts, the number of loans in active foreclosure fell slightly from last month, and is down by 24% from last year. There are now just 267K loans remaining in active foreclosure; 1K fewer than last month and 81K than last month. Finally, and somewhat surprisingly, mortgage prepays (now driven more by housing turnover than refinance activity) increased 14% from September. Even so, they were still 29% below last year’s level.
The report from Black Knight found that:
>>After rising sharply in September, mortgage delinquencies fell by 8.2 percent in October and are now down by nearly 18 percent from the same time last year
>>Serious delinquencies – loans 90 or more days past due – fell by 14,000 from last month and 90,000 from last October to hit a more than 12-year low
>>Improvements in hurricane-related delinquencies associated with Harvey and Irma – which spiked in late 2017 – are contributing to the strong year-over-year improvements
>>Despite foreclosure starts seeing a monthly increase from September’s nearly 18-year low, the number of loans in active foreclosure fell slightly from September and has decreased by 24 percent from last year
>>Prepayment activity – now driven primarily by housing turnover – climbed 14 percent, but remains 29 percent below last year’s level