February saw its first rise in delinquencies in 12 years, according to Black Knight’s [1] First Look at February mortgage data. Despite the monthly increase, Black Knight noted that delinquencies are 9.5 percent below last year’s level.
According to the First Look, February and March are typically high points in the year, mainly due to tax refunds. Despite the increase in delinquencies, foreclosures were down 19.5 percent from January, at 40,400 in February, close to September 2018’s 15-year low. The national foreclosure rate continued to improve and as of February is now down more than 21 percent from last year.
CoreLogic’s Loan Performance Insights [2] report noted a similar trend. While February may have lagged behind slightly, delinquency rates are still dropping overall, although recent natural disasters have impacted some states, DS News reported [3]. According to CoreLogic, 10 out of the only 12 metro areas to experience increases in serious delinquency (loans 90 days or more past due) were located in the Southeast, in areas such as Panama City, Florida.
"On a national basis, income and home-price growth continue to support strong loan performance,” said CoreLogic President and CEO Frank Martell. “Although things look good across most of the nation, areas that were impacted by hurricanes and other natural hazards are experiencing a sharp increase in the numbers of mortgages moving into 60-day delinquency or worse. One specific example is Panama City, Florida, which was devastated by Hurricane Michael, where 60-day delinquencies rose to 3.5 percent in December."
The total U.S. foreclosure pre-sale inventory rate was 0.5 percent in February, representing a 0.35 percent decline month over month, and a 21.3 percent decline year over year. Additionally, Black Knight notes that prepayment speeds rose by 11 percent from January’s 18-year low. This may indicate an increase in refinance activity driven by the recent decline in 30-year interest rates.
Black Knight will release its Mortgage Monitor on Monday, April 1.