Foreclosures

Experts expect only a small uptick in distressed mortgages, either through default or inability to refinance, which will create some opportunity for debt buyers

But March's overall late payment rate was 1.3 percentage points higher than one year ago, while the 90-day-plus rate was 2.3 percentage points higher.

For the first time since the pandemic began, the share of borrowers who are 30 days or more late on their payment is below 5%, Black Knight found.

Only 0.9% of mortgage borrowers are currently at least 90 days delinquent. That figure could rise as high as 3.8% once pandemic-related deferrals lapse — still well below the 6% mark reached after the Great Recession, according to research by the New York Fed.

Most of the activity covered vacant and abandoned properties or commercial loans, according to Attom Data Solutions.

While government protections currently shield most borrowers and delay process timelines, a growing backlog is likely to hit some areas of the country worse than others.

Federal Housing Finance Agency Director Mark Calabria said he wants to work with the consumer bureau on an “exit strategy” for borrowers approaching the end of their forbearance periods.

Also, even with bans in place, the total number of filings keeps inching up due to actions taken on vacant properties.

One official at the bureau said this fall could be an “unusual point in history” for the mortgage market as delinquent borrowers exit forbearance plans. The agency proposed new steps for servicers to help consumers stay in their homes.

As an improving job market aided financial stability for borrowers, 2020 ended with drops in delinquent home loans, a CoreLogic report found.

While foreclosure moratoria keep the overall numbers down, zombie foreclosure rates jumped in the majority of states, according to Attom Data Solutions.

Servicers could be dealing with approximately 1.8 million distressed properties when the latest forbearance extension ends in June, Black Knight said.

The decision provides more clarity to noteholders in the state about when the six-year statute of limitations to bring a foreclosure action begins.

While the Mortgage Bankers Association hailed the move, some experts say it could negatively impact housing inventory.

Gains in consumer financial stability helped to decrease the rates of distressed home loans, but job creation is needed to make recovery sustainable, a CoreLogic report found.

The CARES Act-related forbearances could be “lulling us into a false sense of security” as 12-month expirations approach, according to Black Knight.

The government-sponsored enterprises’ moratoria will now continue well past inauguration day, according to the Federal Housing Finance Agency.

While the annual total marks a 16-year low, the numbers are likely to change dramatically once government moratoria expire, according to Attom Data Solutions.

Commercial real estate portfolios have held up better than expected during the pandemic. But rising delinquencies and fears of a delayed economic recovery are renewing questions about credit quality.

About 4,400 loans started the foreclosure process in November, alongside 176,000 mortgages in active foreclosure.