Foreclosure starts increased nationwide for the third consecutive month but are down 20 percent from last year, according to Black Knight Financial Services' "First Look" at mortgage data for July 2014 released on August 26.
With almost 91,000 mortgage starts in July, the volume of mortgage starts increased 2.72 percent from June, according to Black Knight. Overall inventory fell by 1.65 percent from June down to 935,000 in July. The overall inventory is down 34 percent from July 2013 and has hit its lowest level since March 2008.
Mortgage delinquencies – properties for which the borrower is more than 30 days behind on payments but are not yet in foreclosure – are down in July after slightly increasing from May to June (rising 1.5 percent up to about 2.88 million), Black Knight reported. From June to July, delinquency rates dropped 1.13 percent to 2.85 million – still about 10,000 more than what they were in May.
July marked the fifth consecutive month-over-month increase for the monthly prepayment rate, which experienced a significant increase of 10.24 percent to 1.05 percent – but it is still down 41 percent from July 2013, according to Black Knight. The monthly prepayment rate is "historically a good indicator of refinance activity," Black Knight said.
Also in July, total loans in foreclosure are past due for an average of 1,001 days, according to Black Knight. For loans that are 90 or more days delinquent but not in foreclosure, the average time is 501 days. Black Knight reports that as of the end of July, there were nearly 1.4 million properties in the U.S. for which the borrower was more than 90 days delinquent but the loan was not in foreclosure. That number decreased by about 19,000 from June and by about 211,000 from July 2013.