Distressed

More incentives are coming for servicers as a greater number of distressed borrowers get expanded access to more affordable, streamlined modifications.

Mortgage prepayment rates also fell to a new low for the third consecutive month in December, according to Black Knight.

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.

But the numbers still generally remain below pre-pandemic levels, according to Attom.

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.

The latest fluctuations in some subsets of the Mortgage Bankers Association's numbers suggest it's getting a little more difficult for entry-level buyers to keep paying their loans.

The Redfin study covers property transactions between January 2021 and September 2022.

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

Forbearance could be used regularly to address a broader range of hardships, but how expansive that range should be is subject to debate.

Higher inflation and mortgage rates led to the increased likelihood that conforming loans originated in the three months ended Sept. 30 would go 180 or more days delinquent, Milliman found.

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.

New York, Chicago and Philadelphia led the list of large metropolitan markets considered vulnerable to a downturn, based on analysis from Attom.

In order to address contractor pricing issues, the property preservation and management firm is shifting to a self-performing model by opening a national network of regional centers.

While some year-over-year upticks have materialized, the benchmarks reported for September were still generally on par with or below pre-pandemic levels, according to CoreLogic.

As the share of forborne loans increased for the first time in more than two years, servicers are cautiously eyeing data trends but appear equipped to handle storm-related distress.

But an executive at the mortgage company's corporate parent feels the agency, which is facing a court challenge to its funding, is engaging in regulatory overreach.

But the likelihood of a recession and higher unemployment should drive the rate higher in the future, the Mortgage Bankers Association said.