The national mortgage delinquency rate rose 5 basis points (bps) to 3.55% in June, roughly half the typical seasonal rise, according to data from Intercontinental Exchange Inc. (NYSE: ICE). The rate is 60 bps below the June 2019 pre-pandemic benchmark of 4.16%.
The share of mortgages in active foreclosure reached 0.53% in June, the highest level in six years, as foreclosure activity continued to normalize. Foreclosure starts hit a six-year high, and foreclosure sales were up 16% from a year ago, though they remained 46% below pre-pandemic levels.
The number of borrowers becoming 30- and 60-days delinquent fell in June on both a monthly and annual basis. Serious delinquencies (90-plus days past due but not in foreclosure) fell to 570,000, extending the seasonal improvement that began in March. New FHA defaults were down 15% year-over-year in June, their largest annual decline in more than four years.
Single-month mortality (SMM) eased 2 bps to 0.77%, a five-month low, as mortgage rates remained elevated, though June’s SMM remained 12 bps above year-ago levels.
“Overall performance remained strong in June,” said Andy Walden, head of mortgage and housing market research at ICE. “Early-stage delinquencies remain subdued, and while serious delinquencies including foreclosures have reached pre-pandemic levels, new default activity has leveled off in recent months — a positive sign. New FHA defaults, which have been a focal point of market attention, were down 15% year over year in June. These trends are encouraging, even as the market continues to warrant close monitoring.”
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