Delinquency Rate Continued to Fall in January But Foreclosure Starts Spiked


The national mortgage delinquency rate fell to 3.75% of all loans in January, a decrease of 3.45% compared with December and down 12.93% compared with January 2018, according to the latest First Look report from Black Knight.

About 1.945 million properties were 30 days or more past due in January, a decrease of about 68,000 compared with December and down about 257,000 compared with January of last year.

Of those, about 504,000 were seriously delinquent, or more than 90 days past due but not in foreclosure. Thats a decrease of about 7,000 compared with the previous month and down about 203,000 from a year earlier.

The total number of properties in the pre-sale inventory – which is all the homes in some stage of the foreclosure process – was about 265,000, down about 60,000 from December and down 72,000 from a year earlier.

As of the end of January, the foreclosure inventory stood 0.51% of all homes with a mortgage – a decrease of 2.20% compared with January and down 22.43% compared with January 2018.

There were about 50,200 foreclosure starts in January – an inc lease of 8.42% compared with December but down 19.42% compared with January 2018.

The monthly prepayment rate was 0.59%, a decrease of 10.15% compared with December and a decrease of 25.20% from a year earlier to reach the lowest level since November 2000. 

The decrease in the monthly prepayment rate was somewhat unusual in that prepayments typically rise when mortgage rates decrease, which is what happened in January.

Black Knight notes that housing turnover typically bottoms out in January and February, so prepayments could pick up again if rates remain low through the early spring home buying season.

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