The U.S. mortgage delinquency rate ticked up in March, as the coronavirus pandemic took hold, but in another sign of just how strong the mortgage market was heading into the crisis, serious delinquencies and foreclosure starts hit all-time lows.
The percentage of loans 30 days or more past due was 3.39%, an increase of 3.33% compared with February but down 7.25% compared with March 2019, according to Black Knight’s First Look report.
About 1.8 million loans were 30 days or more past due, an increase of about 55,000 compared with the previous month but down about 111,000 compared with a year earlier.
Black Knight notes that it was the first March since 2000 that the mortgage delinquency rate increased.
March is typically a strong month for mortgage performance – so the increase is an early sign of COVID-19’s impact on the market.
But, in general, the strong loan performance of February carried on into March: Only about 406,000 loans were seriously delinquent, or 90 days or more past due but not in foreclosure, down about 3,000 compared with February and down about 87,000 compared with March 2019. That’s an all-time low.
The foreclosure pre-sale inventory rate in March stood at about 0.42%, down 7.73% compared with the previous month and down 17.96% compared with a year earlier.
As of the end of the month there were about 220,000 homes in the pre-sale foreclosure inventory, down about 19,000 compared with the previous month and down about 44,000 compared with a year earlier.
Foreclosure starts also hit an all-time low in March: They dropped to 27,600 for the month – that’s down 14.55% compared with February and down 30.48% compared with March 2019.
The monthly prepayment rate was 1.89%, up 39.68% compared with the previous month and up 125.24% compared with a year earlier.
Black Knight says the increase in prepayment activity was driven by record-low 30-year mortgage rates.