Good News and Bad News

The Black Knight Mortgage Monitor for July has a bit of good news and bad. 

The Good News

Mortgage delinquencies continued to improve in July, falling 9% from June, with more than 340K fewer past due mortgages than the month prior.

Early-stage delinquencies (30 days past due) have fallen below their pre-pandemic norms. This is a good sign that – at least for the time being – the inflow of new COVID-19-related delinquencies has subsided. 

Though foreclosure starts ticked up slightly for the month, COVID-19 foreclosure moratoriums are keeping both foreclosure starts and completions at record lows. 

Driven by record-low mortgage interest rates, prepayment activity edged slightly higher in July, hitting its highest point since early 2004. 

The Bad News

Some 376K homeowners became 90 or more days past due in July. 

Serious delinquencies were up 20% from June and are now the highest they've been since early 2010. 

In total, serious delinquencies are now 1.8M over pre-pandemic levels.