Home News Serious mortgage delinquencies are up 55% over pre-pandemic levels

Serious mortgage delinquencies are up 55% over pre-pandemic levels

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According to new data from mortgage technology and data provider Black Knight, the number of borrowers with three or more overdue mortgage payments is 55% above pre-pandemic levels. There were about 400,000 serious arrears left before the pandemic, but today about 640,000 are shown in the data. And while it sounds very worrisome, professionals say it’s not what it looks like. ((((You can see here the lowest mortgage rates you might qualify for.).

Indeed, Black Knight data show that the number of serious delinquency has increased since before the pandemic, but that particular number gives a complete picture of what’s happening in the wider housing market. No, explains Jacob Channel, senior economic analyst at Lending Tree.

The data show that serious delinquency has increased over the years, but was very low before the pandemic anyway. And Black Knight reports that it fell between 6-12% in each of the last 14 months. Looking at the gist of this data, CoreLogic data show that the severe delinquency rate for FHA loans is almost five times the severe delinquency rate for traditional loans. “Homeowners with FHA loans are likely to be low-income to middle-income workers, and pandemics are more likely to be these homes compared to homeowners with traditional loans. It had a big impact on the owner. “

In addition, the national misconduct rate (which takes into account one-month misconduct) dropped to 2.80% in April, hitting a record low for the second straight month, Black Knight said. As CoreLogic concluded in February, “National mortgage delinquency rates have improved significantly compared to last year … lower local unemployment rates, sharper rises in home prices, and overall delinquency in housing demand. It helps to reduce the rate. “

In April, one-time borrowers increased by 7.9%, but were offset by an 8% decrease in three or more repayments. In addition, foreclosure initiation (the process of initiating foreclosure after 120 days of late fees) decreased by 12% from March.

“Overall mortgage delinquency rates have also fallen to record lows. [foreclosure starts] In fact, it decreased by 12% from February to March. This is the largest month-on-month decrease in 20 years, “says Channel. Also, the start of foreclosure is below the pre-pandemic level. This means that even if a relatively large number of people are in serious delinquency, many are not actively seized.

What does this all mean for the housing market?

After all, most data show that the housing market is pretty strong, despite some problems here and there, professionals say.The vast majority of people seem to be able to keep up with their mortgage payments, and this Economists and real estate professionals told MarketWatch Picks about the current housing market. “High interest rates and highs may drive some people out of the market and eventually begin to put even more significant downward pressure on demand, but many homebuyers suddenly lag or default. There isn’t much evidence to suggest seeing about their loans in the near future, “says Channel.

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