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Foreclosures Slide to All-Time Low

While roughly twice as many foreclosure sales occurred within the month as compared to December 2020, there were only one-third as many as in pre-pandemic December 2019. Given the large volume of borrowers who've exited forbearance protections in recent months, the industry are keeping a close eye on foreclosure metrics moving forward in 2022.

Black Knight Inc. released the following "first look" at December 2021 month-end mortgage performance statistics derived from its loan-level database representing the majority of the national mortgage market.

Total U.S. loan delinquency rate (loans 30 or more days past due, but not in foreclosure): 3.38%

  • Month-over-month change: -5.88%
  • Year-over-year change: -44.46%

Total U.S. foreclosure pre-sale inventory rate: 0.24%

  • Month-over-month change: -3.80%
  • Year-over-year change: -27.98%

Total U.S. foreclosure starts: 4,100

  • Month-over-month change: 10.81%
  • Year-over-year change: -42.25%

Monthly prepayment rate (SMM): 1.65%

  • Month-over-month change: -7.31%
  • Year-over-year change: -47.60%

Foreclosure sales as % of 90+: 0.29%

  • Month-over-month change: 12.07%
  • Year-over-year change: 324.16%

Number of properties that are 30 or more days past due, but not in foreclosure: 1,799,000

  • Month-over-month change: -107,000
  • Year-over-year change: -1,452,000

Number of properties that are 90 or more days past due, but not in foreclosure: 946,000

  • Month-over-month change: -80,000
  • Year-over-year change: -1,200,000

Number of properties in foreclosure pre-sale inventory: 128,000

  • Month-over-month change: -4,000
  • Year-over-year change: -50,000

Number of properties that are 30 or more days past due or in foreclosure: 1,927,000

  • Month-over-month change: -112,000
  • Year-over-year change: -1,502,000

Some 0.24% of loans are in active foreclosure in December, a historic low, with the month's 4,100 foreclosure starts almost 90% below December 2019 levels. Prepayment activity fell by more than 7% in December and is projected to fall even further as rising rates continue to erode refinance incentive.

Top five states by non-current percentages were:

  1. Louisiana: 7.06%
  2. Mississippi: 6.91%
  3. West Virginia: 5.37%
  4. Alabama: 5.11%
  5. Oklahoma: 5.08%

Bottom five states by non-current percentage:

  1. Utah: 2.20%
  2. California: 2.13%
  3. Washington: 2.03%
  4. Colorado: 2.02%
  5. Idaho: 1.85%

Top five states by 90+ Days delinquent percentage:

  1. Louisiana: 3.84%
  2. Mississippi: 3.41%
  3. Oklahoma: 2.55%
  4. Alabama: 2.52%
  5. Arkansas: 2.50%

Top 5 states by 6-month improvement in non-current percentage:

  1. Hawaii: -46.54%
  2. Nevada: -35.61%
  3. California: -34.04%
  4. Vermont: -27.62%
  5. Washington: -27.28%

For a more detailed view of this month's data from Black Knight, click here.

About Author: Demetria Lester

Demetria C. Lester is a reporter for DS News and MReport, with more than six years of writing experience. She has served as Editor-in-Chief at Northlake College and staff writer at her alma mater, the University of Texas at Arlington. She has covered events such as the Byron Nelson, Pac-12 Conferences, the Women in Dallas Film Festival, to freelance work with the Dallas Wings and D Magazine. Currently located in Dallas, Texas, she is an avid jazz lover and reader. She can be reached at demetria.lester@thefivestar.com.
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