Foreclosure inventory dropped to its lowest level since 2007 while the share of non-current residential loans (30 days or more delinquent but not in foreclosure) also substantially declined and is near a post-crisis low, according to Black Knight Financial Services' First Look at Mortgage Data for July 2015 released Friday.
The number of properties in foreclosure pre-sale inventory dropped by 24 percent year-over-year in July down to 711,000 properties, representing about 1.4 percent of all residential mortgages nationwide. It was the lowest total of properties in foreclosure inventory for one month since 2007, according to Black Knight.
Foreclosure inventory was not the only metric that experienced a large decline in July, however. The delinquency rate (percentage of properties 30 days or more overdue but not in foreclosure) dropped by 16 percent year-over-year down to 4.71 percent, nearly reaching its lowest point since the crisis. That share of 4.71 delinquent properties represents about 2.39 million loans nationwide.
Among states, Colorado's non-current residential mortgage loan share of 2.96 percent was the lowest in that state in 10 years. It was also the second-lowest rate in the nation in July (North Dakota's non-current rate was 2.12 percent). The state with the largest 16-month improvement in non-current share in July was Florida with 21.6 percent, down to 7.69 percent; that share is approximately one-third of California's non-current residential mortgage loan share peak of 25.48 percent reached in January 2010. California joined the top five in six-month improvement for non-current loan share with a decline of 16.4 percent, down to 3.52 percent. California's peak was 15.69 percent, reached in February 2010.
The number of foreclosure starts during July also declined nationwide both over the month and over the year. July's total of 75,400 foreclosure starts represented a decline of 4.5 percent from June and nearly 17 percent from July 2014, Black Knight reported.
The monthly prepayment rate, which is historically a good indicator of refinance activity, was reported at 1.26 percent in July – a decline of 9.4 percent from June but was up from 20.4 percent from July 2014.
For its "First Look" at mortgage data, Black Knight used statistics from its loan-level database representing about two-thirds of the overall mortgage market.