Key facts
- The national mortgage delinquency rate rose to 3.53% in August.
- Serious delinquencies increased by 11,000 to 574,000 in August.
- Mortgage prepayment speeds fell to a 17-month low in August.
- Foreclosure starts were 29% higher than a year earlier.
- Foreclosure sales were 12% higher annually.
- Active foreclosure inventory increased by 2,000 loans in August.
Intercontinental Exchange (ICE) reported that the national mortgage delinquency rate increased by 14 basis points to 3.53% in August, a rise largely attributed to calendar effects. After accounting for these effects, the rate was considered effectively flat compared to the prior month. The delinquency rate was 10 basis points higher than a year earlier but remained 35 basis points below its August 2019 level, and below rates seen in every August prior to the pandemic.
Early-stage delinquencies, loans 30 and 60 days past due, saw an increase during the month but remained lower than year-ago levels, with approximately 21,000 fewer loans in these categories compared to the previous year. However, serious delinquencies, defined as loans at least 90 days overdue but not yet in foreclosure, rose by 11,000 in August to reach 574,000. This increase ended a five-month decline, and the number of seriously delinquent loans was 19% higher than a year ago. The serious delinquency rate stood at 1.04% of active loans, which is roughly in line with the average for August from 2017 through 2019.
Foreclosure activity also remained below pre-pandemic levels. Foreclosure starts decreased by 6% from July but were 29% higher year-over-year. Foreclosure sales declined 2% from the previous month and were up 12% annually, though still at only 57% of the pace recorded in August 2019. The share of mortgages in pre-sale foreclosure inventory held steady at 0.54%, its highest level since February 2020. Active foreclosure inventory grew by 2,000 loans in August, the smallest monthly increase since November 2025, but was still up 41% from a year earlier.
Mortgage prepayment speeds continued to slow as interest rates moved higher. Single-month mortality, a measure of loan prepayment rates, fell 11 basis points to 0.64%, marking a 17-month low. August represented the fifth consecutive monthly decline in prepayment speeds, with loans originated between 2023 and 2025 showing a significant drop in their single-month mortality rate. Bob Hart, president of mortgage technology at ICE, stated that while overall performance remains sound, the market is not moving uniformly.