According to the “First Look” report from Black Knight, a leading provider of technology, data, and analytics solutions to the mortgage and real estate industries, the national delinquency rate in the US increased slightly by seven basis points to 3.45% in February 2023. However, this rate is still 12.5% lower than the previous year. On the other hand, prepayments, which had been on a downward trend for the past four months, increased by 0.35%. The report expects this trend to continue as the spring homebuying season takes hold.
The report indicates that the increase in delinquencies is driven by loans that are a single payment behind, which saw a nearly 65,000 unit increase. However, 60-day delinquencies fell by nearly 12,000 units or 4%, and 90-day delinquencies fell by 3% of 17,000 loans. In February, serious delinquencies, defined as payments that are 90 days or more overdue, improved in all states except for five. There was a 9% reduction in foreclosure starts during the month, bringing the total to 29,000 starts. However, this figure remains 19% lower than the levels recorded before the pandemic.
In the past month, the number of homes in active foreclosure inventory increased slightly by 2,000. Compared to February 2022, this is a rise of 34,000 homes, or 15%. However, despite the increase, the current active foreclosure inventory remains 15% lower than its pre-pandemic level. Across the country, there were 7,100 completed foreclosure sales in February, which represents a 2.5% increase from the previous month.
The report provides various statistics related to delinquency and foreclosure rates, such as the total US loan delinquency rate, total US foreclosure pre-sale inventory rate, and total US foreclosure starts. The report also includes the number of properties that are 30 or more days past due or in foreclosure, the top and bottom states by non-current percentage, and the top states by 90+ days delinquent percentage. Additionally, the report highlights the top and bottom states by 12-month change in non-current percentage.
Overall, the “First Look” report from Black Knight suggests that while the national delinquency rate inched up slightly in February 2023, it remains down year-over-year. The report also suggests that the spring homebuying season is expected to increase prepayments, and serious delinquency volumes have improved in most states. However, the report notes that some states are still struggling with high non-current percentages and 90+ days delinquent percentages.