March saw a 3.33% rise in delinquencies, the first-ever rise for the month of March as COVID-19 begins to impact the market. Black Knight's First Look at mortgage delinquency data reports that the typically strong month experienced its first increase since the turn of the century.
Black Knight notes, however, that for the purposes of the First Look, Mortgage Monitor and other reports that Black Knight issues, homeowners in forbearance plans will be counted as a subset of delinquency numbers. They should not, however, be reported as delinquent to credit bureaus by their servicers.
With this in mind, the delinquency rate is expected to rise significantly in the coming months
Earlier data from Black Knight tracked loan-level forbearance data on a daily basis through its newly introduced McDash Flash data set. As Black Knight notes, level of detail is essential for both mortgage market participants and government entities in addressing the ramifications of this crisis.
Black Knight's data showed that as of April 16, more than 2.9 million homeowners, or 5.5% of all mortgages, have entered into COVID-19 mortgage forbearance plans. This population represents $651 billion in unpaid principal and includes 4.9% of all GSE-backed loans and 7.6% of FHA/VA loans.
Black Knight notes that mortgage servicers would be bound to advance $2.3 billion of principal and interest payments per month to holders of government-backed mortgage securities on COVID-19-related forbearances. Another $1.1 billion per month in lost funds will be faced by those with portfolio-held or privately securitized mortgages.
Meanwhile, both the national foreclosure and 90-day delinquency rates set new record lows in March, which Black Knight calls "a lingering reminder" of the strength of the mortgage market heading into the pandemic. At just 27,600 for the month, foreclosure starts also fell to their lowest level on record, as COVID-19-related moratoriums began to impact foreclosure inflows
Prepayment activity jumped by nearly 40% in March, driven by record-low 30-year mortgage rates.