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Mortgage Delinquencies Experience First Increase in Seven Years

BKFS_LogoBlack Knight Inc. released its First Look report Thursday highlighting the main causes of past-due mortgages in September 2017. This data was pulled from Black Knight’s loan-level database, which represents the majority of the national mortgage market.

September experienced its first annual rise in mortgage delinquencies since July 2010, mainly as a result of hurricane impact, to 4.40 percent according to Black Knight. Over 2.6 million properties are 30 or more days past-due but not in foreclosure in September 2017; 80,000 more than the same time last year.  .    

While non-current mortgages jumped by 9 percent month-over-month, or roughly 214,000, mainly driven from Hurricanes Harvey and Irma, monthly foreclosure starts were at their lowest in more than 17 years. Areas covered by post-foreclosure action moratoriums experienced starts as low as 90 percent, with total foreclosure starts landing at 45,200 in September and decreasing 17.4 percent month-over-month.

DS News reached out to Black Knight for a comment on Florida’s improving non-current rates prior to Hurricane Irma: “Florida had the highest non-current mortgage rates of any state for almost five full years–from September 2008 through August 2013. The state’s solid improvement in the years since has helped it climb from number 50 among all states ranked by lowest share of past due mortgages to 28th. In the wake of Irma, Florida has seen–thus far–a 47 percent jump in its non-current rate, dropping it all the way back to 47th place. The rise in Florida’s non-current rate is likely to continue in October.”

Total U.S. loan delinquency increased 11.85 percent compared to August 2017, with the number of properties 30 or more days past due without being in foreclosure landing at 2.25 million, up 242,000 compared to August. Total U.S. foreclosure pre-sale inventory dropped 0.7 percent and fell 30.1 percent year-over-year.  

FEMA-declared hurricane disaster areas accounted for the bulk of increases with non-current inventory raising by 84,000 or 48 percent in Irma disaster areas and 52,000 or 67 percent in areas related to Harvey.

Prior to the hurricanes, Florida and Texas were ranked 22nd and 20th by non-current mortgage rates; these states have since jumped to 5th and 3rd respectively.

The full datasets can be viewed here.

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