Mortgage delinquencies jumped 13% in September compared with August, the largest single-month rise since November 2008, Black Knight reports.
Delinquencies related to Hurricane Florence helped drive a small portion of the increase. Black Knight’s data shows that more than 6,000 borrowers already missed a payment as a direct result of the storm. Delinquencies in the affected areas increased 38%, month-over-month.
However, Black Knight notes in its First Look report that September is typically a month when mortgage delinquencies increase. The firm’s data shows that delinquencies increased in 16 of the last 19 Septembers, with the average increase being around 5.2%.
This September also happened to end on a Sunday, which typically results in a slightly higher delinquency reading.
The total U.S. delinquency rate in September was about 3.97%, up 13.22% compared with August but down 9.77% compared with September 2017.
A little over 2 million properties nationwide were delinquent 30 days or more. That’s up by about 240,000 properties compared with the previous month but down about 196,000 properties compared with a year earlier.
Of those, about 513,000 were seriously delinquent, or 90 days or more past due. That’s an increase of about 7,000 but down about 63,000 compared with September 2017.
There were about 40,000 foreclosure starts for the month, a decrease of 15.07% compared with the previous month and a decrease of 11.5% compared with a year earlier. That’s an 18-year low.
Both the inventory of loans in active foreclosure and the foreclosure rate have now fallen below their pre-recession averages for the first time since the financial crisis.
The pre-foreclosure inventory stood at about 0.52%, down 4.45% compared with August and down 26% compared with September 2017.
As of the end of the month, there were about 268,000 properties in the foreclosure pre-sale inventory, down about 13,000 compared with August and down about 90,000 compared with September 2017.
The monthly prepayment rate stood at about 0.70%, a decrease of 21.24% compared with the previous month and down 26.65% compared with a year earlier. Driving down the prepayment rate
Black Knight notes that the prepayment rate dropped in the face of rising interest rates and affordability pressures, as monthly prepayment activity is now primarily driven by housing turnover.
