Mortgage arrears increasing year-on-year | National Mortgage News

Serious mortgage delinquencies in March were at their lowest levels since before the Great Financial Crisis, although the total number of borrowers who missed their payments on time increased by 9% compared to last yearaccording to ICE Mortgage Technology.

The number of delinquencies fell slightly to 3.2% in March, a decrease of 4.15% or 14 basis points compared to 3.34% in February, the First Look report said. However, in March 2023, total delinquencies were at their all-time low of 2.92%, representing a year-over-year increase of 9.2%.

Industry observers have taken notice the increased equity that most homeowners have acquired has pushed borrowers to keep making their payments in recent years. Those who are having a hard time have an exit strategy with which they can pay off their loan.

This includes a recent report from Morningstar DBRS on securitized mortgages found that the overall default rate in March fell 3 basis points to 1.55% from February, but was 10 basis points higher than a year earlier.

In a typical month of March, mortgage default rates have fallen an average of 10.4% compared to February. However, when a month ends on a Sunday, because payments are not normally processed on that day (or the day before).the rate increases by 6.9%.

This was the third time in the past two decades that March ended on a Sunday, and the 4.15% improvement matched those other two events, according to ICE Mortgage Technology.

Meanwhile, the number of properties for which the borrower is considered seriously delinquent — more than 90 days late on payments but not yet in foreclosure — reached 435,000, the lowest since June 2006, according to ICE Mortgage Technology. That is 24,000 fewer than in February and 77,000 fewer than in March 2023.

All properties where the borrower missed at least one payment totaled more than 1.7 million, which is 71,000 less a month ago but 172,000 more than March 2023.

Presale inventory consisted of 205,000 properties, down 6,000 from February and 35,000 fewer than a year ago.

The speed of prepayments increased in March, mainly because Mortgage interest rates were lower in January and early February. It was the highest number of borrowers who prepaid their loans within seven months.

The monthly early repayment rate of 48 basis points was more than 15% higher than in February. But it was 4.14% slower than March 2023.