Calendar Pushes 30-Day Delinquency Rate Upward

January saw a spike in the number of residential mortgage loans that were 30-plus days delinquent, and a big driver of that was the calendar, according to the Black Knight Financial Services “First Look” at January 2016 Mortgage Data released on Monday.

Delinquencies rose by 6.6 over-the-month in January up to 5.09 percent, the first time the delinquency rate has been over 5 percent in 11 months. The number of 30-day delinquent properties was up by 167,000 over-the-month in January, up to 2.57 million, according to Black Knight. The fact that January ended on a Sunday played a role in the monthly increase, according to Ben Graboske, SVP of Black Knight Data and Analytics.

“January’s spike in delinquencies seems to be more calendar driven than seasonal. January was a month that ended in a Sunday, so any payments made on the last two days of the month couldn't be processed until February,” Graboske said. “We’ve observed this phenomenon often in the past. January delinquency rate increases themselves are uncommon, but if we compare this rise against the last five Sunday month-ends, the rise is actually on par for what we'd typically see."

Despite the monthly spikes, the inventory of loans 30 or more days delinquent but not in foreclosure was down over-the-year in January by 7 percent, computing to about 189,000 properties.

The number of loans in active foreclosure continued a long-term trend of improvement in January, dropping by 26 percent over-the-year and 4.5 percent over-the-month down to about 1.3 percent of all residential mortgage loans (about 659,000 properties). It is the lowest foreclosure inventory rate since November 2007.

Foreclosure sales went up in January, as they typically do when seasonal foreclosure moratoriums expire. Foreclosure completions jumped by 16 percent from December to January. The monthly prepayment rate, which is typically a good indicator of refinance activity, declined by nearly 29 percent over-the-month in January despite declining interest rates throughout the month.

Click here to see Black Knight's complete First Look at Mortgage Data for January 2016.