The U.S. mortgage delinquency rate fell to 3.39% in October, a decrease of 3.82% compared with September and down 6.92% compared with October 2018, according to Black Knight’s First Look report.
That’s within 0.03% of the record low set in May, the mortgage software, data and analytics firm says.
As of the end of the month about 1.786 million loans were 30 days or more past due, but not in foreclosure, a drop of about 68,000 compared with the previous month and a drop of 98,000 compared with a year earlier.
About 433,000 properties were seriously delinquent – 90 days or more past due but not in foreclosure – down about 10,000 compared with September and down about 66,000 compared with October 2018.
Foreclosure starts edged up slightly to about 43,900 for the month. That’s an increase of 11.42% compared with September but down 13.24% compared with October 2018.
The foreclosure inventory rate increased to 0.48%, up 1.05% compared with the previous month but down 6.21% compared with a year earlier.
As of the end of the month there were about 255,000 homes in the foreclosure pre-sale inventory, an increase of about 3,000 compared with September but down about 12,000 compared with October 2018.
A surge in refinances continued to boost the monthly prepayment rate, which rose to 1.81% – an increase of 16.41% compared with the previous month and and increase of 134.20% compared with a year earlier.
Its was the highest prepayment level since May 2013.
Black Knight notes that prepayments will likely slow if mortgage rates increase in the weeks to come. In addition, slowing home sales this fall – in keeping with seasonal cycles – will also dampen prepayments.