In Depth Analysis: CalculatedRisk Newsletter on Real Estate (Ad Free) Read it here.

Wednesday, February 24, 2021

Black Knight: National Mortgage Delinquency Rate Decreased in January

by Calculated Risk on 2/24/2021 12:51:00 PM

Note: 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’s First Look: Mortgage Delinquency Rate Falls Below 6% for First Time in Nearly a Year, Yet 2.1M Homeowners Remain Seriously Delinquent

• The national mortgage delinquency rate fell to 5.9% in January, dropping below 6% for the first time since March 2020

• January’s improvement among overall delinquencies as well as seriously past due mortgages was nearly identical to the average monthly improvement seen during the recovery to date

• While delinquencies continue to improve slowly and steadily, some 2.1 million homeowners remain 90 or more days past due but not yet in foreclosure – still five times pre-pandemic levels

• Recent forbearance and foreclosure moratorium extensions have reduced near-term risk, but at the same time may have the effect of extending the length of the recovery period

• At the current rate of improvement, 1.8 million mortgages will still be seriously delinquent at the end of June when foreclosure moratoriums on government-backed loans are currently slated to lift

• With widespread moratoriums still in place, both foreclosure starts and sales (completions) remained near record lows in January

• Prepayment activity fell by 17% month-over-month in January but remains 86% above last year’s levels
emphasis added
According to Black Knight's First Look report, the percent of loans delinquent decreased 3.8% in January compared to December, and increased 82% year-over-year.

The percent of loans in the foreclosure process decreased 3.9% in December and were down 31% 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 5.85% in January, down from 6.08% in December.

The percent of loans in the foreclosure process decreased in January to 0.32%, from 0.33% in December.

The number of delinquent properties, but not in foreclosure, is up 1,425,000 properties year-over-year, and the number of properties in the foreclosure process is down 75,000 properties year-over-year.

Black Knight: Percent Loans Delinquent and in Foreclosure Process
In Foreclosure0.32%0.33%0.46%0.51%
Number of properties:
Number of properties
that are delinquent,
but not in foreclosure:
Number of properties
in foreclosure
pre-sale inventory:
Total Properties3,301,0003,429,0001,951,0002,210,000