As the COVID-19 crisis
dragged into its sixth month in August the total number of mortgage
delinquencies continued to ebb, but the rate of decline appears to be slowing. Black
Knight, in its first look at the month’s loan performance data, found the
national delinquency rate down 3 basis points to 6.88 percent. There were 13,000
fewer delinquent loans in August than in July, a total of 3.68 million that
were 30 or more days past due but not in foreclosure. Black Knight considers
loans in forbearance plans as delinquent even if servicers are not reporting
them as such to the credit bureaus.
The share of borrowers with a single
missed payment had already fallen below pre-pandemic levels. In August, the sum
of all early-stage delinquencies (those 30 and 60 days past due) fell 9
percent, dropping below that benchmark as well
That’s the good news. However,
the national delinquency rate is 99.22 percent higher than it was in August of
2019, and 3.68 million homeowners are behind in their payments but not in
foreclosure. Further, the improvement in the delinquency rate in June and July dwarfed
August, a total decline of 85 basis points over the two months.
The number of serious
delinquencies, i.e. loans that are at least 90 days past due but not in
foreclosure, rose by 116,000 from July to August, an increase of 5 percent, and
by 1.922 million loans year-over-year. Serious delinquencies have increased in
each of the past five months although the growth in August was less than
earlier months, suggesting they may be reaching a peak.
remain down, about 40 percent lower than in July and 84 percent lower than a
year earlier at 6,000 actions. Loans in the process of foreclosure total
187,000, a rate of 0.35 percent. This is a slight decrease from July and 27
percent lower than in August of 2019. Black Knight says the subdued foreclosure
activity is due to active forbearance plans and foreclosure moratoriums.
The company will provide a more
in-depth review of the August loan performance data in its monthly Mortgage
Monitor report which will be published by Oct. 5, 2020.