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National Delinquency Rate Dips Below Pre-Great Recession Average

The national delinquency rate in June dipped to its lowest level since the onset of the coronavirus pandemic and is now back below its pre-Great Recession average. Still, more than 1.5 million borrowers remain delinquent by 90 days or more, according to the latest loan performance data from Black Knight. The full mortgage monitor report will be available on Black Knight's website by August 2, the company reports, while disclosing some of the survey's results this week.

At the current rate of improvement those serious delinquencies will still number about 1 million when the first wave of forbearance expirations start in September. Black Knight, which also tracks weekly forbearance activity, reports that the vast majority of seriously delinquent mortgagors are enrolled in forbearance plans.

Nationwide, no state is exempt from the elevated rates in serious delinquencies—those remain elevated by more than a full percentage point across all 50, with Hawaii and Nevada's serious delinquency rates remaining elevated by 3.4 percentage points.

Due to those COVID-19-related forbearance plans and associated foreclosure moratoria, the foreclosure rate remains at an all-time low, nationwide, at .27%.

Also noted in Black Knight's report, is that recent pullbacks in interest rates resulted in prepayment activity edging upward for the first time in three months.

Mississippi, Louisiana, Hawaii, Oklahoma, and West Virginia lead the way in overall delinquent loans. States with the least delinquent loans include Montana, Utah, Washington, Colorado, and Idaho.

Earlier this month, CoreLogic's report on national delinquency rates showed the first year-over-year decrease in delinquencies in about a year.

Those researchers credited recovery on the jobs and income front with enabling more homeowners to resolve their unsettled-payment status.

"The sharp rebound in the economy, as well as a potent combination of government fiscal and regulatory help, is fueling unprecedented demand for residential housing and enabling people to buy and stay in their homes," said Frank Martell, President and CEO of CoreLogic at the time. "The drop in delinquency rates is a further manifestation of the benefits of these tail winds."

Black Knight's full report will be available at blackknightinc.com/data-reports/ [1] by August 2.