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The number of mortgages starting the foreclosure process increased in August from July, while the number of mortgage delinquencies stayed near record lows during the month, according to Black Knight's First Look at August's mortgage performance data.
Overall, mortgage performance has remained solid in August. The number of foreclosure starts jumped 15% in August (vs. July), but remain 44% below August 2019 levels, the firm said.
Foreclosure starts were initiated on 3.4% of serious delinquencies, up slightly from July but still less than half the rate seen in the years before the pandemic.
Source: Black Knight
The national mortgage delinquency rate fell 3.6% in August to 2.79%, only 4 basis points higher than May 2022's record low.
Meanwhile, prepayments rose 1.5% for the month, due to calendar-related effects, said Black Knight, but are down 69% Y/Y as rising mortgage rates put downward pressure on purchase and refinance lending.
The stocks of mortgage servicers Rithm Capital (NYSE:RITM), formerly New Residential Investment, Ocwen (NYSE:OCN), and Mr. Cooper (NASDAQ:COOP) have had a volatile year, but Ocwen and Mr. Cooper have both fared better than the S&P 500's -16% decline as seen in this chart.
Earlier in September, mortgage rates topped 6% for the first time since late 2008, then climbed to 6.29% on Thursday.