Distressed

Foreclosure prevention actions overall fell for the sixth time in seven months in October, according to the FHFA.

The share of loans with suspended payments remained steady as 2022 ended, but that could change this year if unemployment increases in line with forecasts, according to the Mortgage Bankers Association.

The measure enacted on Dec. 30, 2022 applies retroactively and could add servicing risks that lending divisions will likely consider in underwriting and pricing on new loans originated in the state.

The overall share of distressed mortgages fell in every state, but the effects of Hurricane Ian led to a small uptick in early-stage late payments compared to one year ago, CoreLogic said.

Foreclosure starts also increased by over 19% between October and November but remain below pre-pandemic levels.

Deterioration in credit quality should put strain on collateral originated in late 2021 and early 2022, affecting performance, Barclays Credit Research said.

Home prices dropped again on a monthly basis in October, exacerbating the loss in home equity among recent buyers, but the size of the falloff was the smallest since June.

The share of home loans late by more than 30 days or in foreclosure in August inched back down to 2.8% from 3% the previous month, according to CoreLogic.

Three percent of all mortgages were 30 or more days past due on their scheduled payment or in foreclosure in July.

The month ended with 54,000 less properties for which the borrower was at least 30 days or more late on their payments, Black Knight said.