1.45 million homeowners have seriously violated the law as foreclosure moratorium expires

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Delinquencies on mortgages are falling, but they are still much higher than they were before the pandemic. (iStock)

National mortgage delinquency rates fell 5% in July to 4.14% – half the May level – but about 1.45 million homeowners are still seriously delaying mortgage payments, new data from Black Knight show.

The number of late payments decreased in 12 of the last 14 months, and the two increases were due to the calendar month and falling deadlines, not worsening performance.

“While overall crime rates continue to approach pre-pandemic levels, serious offenses are still on the rise as federal the moratorium on foreclosures expired at the end of July, “says the Black Knight report.

As of the end of July, about 1.45 million borrowers were at least 90 days overdue. The data showed that these borrowers are in late arrears but not yet foreclosed and represent 1 million more than at the start of the pandemic. However, many of them are currently on plans to abstain from their mortgage services.

If you’re giving up on leniency and want to make sure you don’t go to foreclosures, consider refinancing your mortgage to keep your monthly payments down. Visit Credible to Use a Mortgage Calculator and see how much you can save.

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In the second quarter, overdue debt decreased significantly.

The Black Knight report said the number of foreclosures remained low in July, the final month of a moratorium on federal-backed mortgage buyouts. The number of loans in active foreclosure fell 5,000 to another record low.

Looking at the second quarter of 2021 as a whole, data from the Mortgage Bankers Association (MBA) put the national mortgage delinquency rate at 5.47%. National Crime Survey

“Mortgage delinquencies across all loan types — conventional, FHA and VA — have reached their lowest level since Q1 2020,” said Marina Walsh, MBA vice president of industry analysis. “The decline in FHA and VA loan delinquencies was the largest quarterly decline for both in the history of the 1979 MBA study.

“To a large extent, the improvement in the second quarter can be attributed to overdue loans at later stages – in those 90 days or delays, but not in the loss of foreclosures,” Walsh said. “In fact, the 90-day delinquency rate fell 72 basis points, another record drop in the study. Borrowers in the later stages of delinquency appear to be recovering due to several factors, including improved employment and other economic conditions, and the availability of options. home retention workouts after abstinence; and a strong housing market that offers additional alternatives for troubled homeowners. “

One of these options, fueled by a strong housing market, includes mortgage refinancing, which helps homeowners pay their monthly mortgage payments by lowering costs. With interest rates at an all-time low, homeowners can save a lot. Visit Credible to see how much you can save and pre-qualify in minutes without affecting your credit score.

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How to avoid foreclosure

As Walsh pointed out, late payments are falling at a significant rate due to the multitude of options available to homeowners through government programs and a strong housing market. Here are some of the options available to homeowners to prevent foreclosures:

Patience: Homeowners struggling to make their monthly payments still have the option to enter Abstinence due to COVID-19 after the Biden administration extended the term until September 30, 2021. This deadline applies to loans from the Department of Housing and Urban Development (HUD), the Department of Veterans Affairs (VA) and the Department of Agriculture (USDA). The Federal Housing Finance Agency (FHFA) has provided similar relief for mortgages secured by Fannie Mae and Freddie Mac, and this option has no deadline.

Refinancing: Homeowners can also refinance your mortgage in today’s strong housing market. Even homeowners who missed payments and were tolerant of COVID could still be able to refinance their mortgage. By comparing multiple mortgage lenders at once, homeowners can find the best rates available to them. Visit an online marketplace like Credible to find the best one for you and save on monthly bills.

Modification: If you are unable to refinance your mortgage but are still struggling, changing the loan may change the terms of the loan. Contact your mortgage officers to discuss your options, such as lowering interest rates or changing other loan terms.

If you are looking for mortgage loan options, contact Credible to speak with a home loan specialist and get answers to all your questions.

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Have a financial question but don’t know who to contact? Write to a safe money expert at moneyexpert@credible.com and your question can be answered by Credible in our Money Expert column.

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