Foreclosure Starts Jumped in July as Mortgage Delinquencies Ebbed 

Foreclosure starts jumped 4.3% in July compared with June and were up 7.61% compared with July 2024, according to ICE Mortgage Technology’s First Look report.

There were about 32,000 foreclosure starts nationwide for the month, according to the firm’s data.

In addition, foreclosure sales surged 9.68% to reach 6,900 for the month. That’s up about 25% year-over-year.

As of the end of the month the foreclosure pre-sale inventory rate was about 0.38%, a decrease of about 0.62% compared with the previous month but up about 8.1% compared with a year earlier.

There were about 207,000 residential properties in the foreclosure pipeline, down about 1,000 compared with June but up about 19,000 compared with July 2024.

Delinquencies, meanwhile, dropped to a rate of 3.27%, down about 2.47% compared with the previous month and down about 2.82% compared with a year earlier.

As of the end of the month, there were about 1.794 million residential properties in some stage of delinquency, down about 40,000 compared with June and down about 18,000 compared with July 2024.

There were about 466,000 serious delinquencies (90 days or more past due but not in foreclosure), flat compared with the previous month but up about 30,000 from a year ago.

The monthly prepayment rate for July was 0.67%, an increase of 2.87% compared with the previous month and up about 12.34% compared with a year earlier.

“If you are looking for signs of a faltering economy, you won’t find them in July’s mortgage performance data,” says Andy Walden, head of mortgage and housing market research at ICE. “New delinquency inflows were down -13 percent from June and -5 percent from the same time last year, with the national delinquency rate improving on an annual basis for the second straight month, breaking what had been a 13-month streak of consecutive increases.”

FHA loans remain the primary driver of stress in the market, ICE says.

While FHA delinquencies ticked down by 5 basis points in July, they are still 15 basis points above year-ago levels and now account for the majority (52%) of serious delinquencies nationwide.

Photo: Matthew Moloney