Loan Performance Report Reveals ‘Good News’

According to a representative from Black Knight, their data analysts' monthly loan-performance report contains "pretty much good news all around, though most of it is the slow-and-steady-wins-the-race variety."

In summary, mortgage delinquencies continued to improve in October, falling another 3.3% from September to reach the lowest level since March (6.44%). Month-over-month, there are 105,000 fewer past-due mortgages in October.

Five consecutive months of improvement notwithstanding, there are almost twice as many delinquencies as there were at the start of the year. In total, 3.4 million homeowners are past due on their mortgages.

Serious delinquencies—loans 90 or more days past due—improved as well, but there are still more than 5 times as many as there were pre-pandemic. There are roughly 1.8 million more serious delinquencies than at the start of 2020.

Widespread COVID-19 foreclosure moratoriums continue to keep foreclosure activity at record lows, according to Black Knight. There were just 4,700 foreclosure starts in October, a nearly 90% year-over-year decline. And the number of loans in active foreclosure hit yet another record low at 178,000.

Finally, record-low interest rates pushed prepayment activity higher, with October’s prepayment rate of 3.17% setting the highest single-month mark in more than 16 years.

Find this and all of Black Knight's monthly mortgage reports here.