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Mortgage delinquencies level off in June as FHA new defaults drop

ICE’s First Look report put June’s delinquency rate at 3.55%, up slightly seasonally, while the foreclosure inventory rate rose to 0.53% and foreclosure starts hit a six-year high.

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Intercontinental Exchange’s latest First Look Mortgage Performance report found that early-stage mortgage issues improved in June even as delinquencies ticked higher on a seasonal basis. HousingWire reports June’s overall delinquency rate was 3.55%, still below the 4.16% pre-pandemic benchmark from June 2019.

The report said new default activity remained stable, with new defaults among Federal Housing Administration borrowers down 15% year over year, the largest annual decline in more than four years. HousingWire also noted that serious delinquencies, loans 90 or more days past due but not in foreclosure, fell to 570,000, the lowest level in six months.

ICE reported more foreclosure activity, with the active foreclosure inventory rate rising to 0.53% in June, the highest in six years. Foreclosure starts reached a six-year high, and foreclosure sales increased 16% from a year earlier, though they remained 46% below pre-pandemic levels.

ICE Mortgage Technology said elevated homeowner equity continued to help some distressed borrowers avoid foreclosure despite the increase in early foreclosure activity. HousingWire cited comments from ICE Mortgage Technology President Bob Hart on the role of homeowner equity, even as early foreclosure activity remained elevated.

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