Foreclosure starts dropped to their lowest level in 18 years, and properties foreclosed on but not yet sold fell to a 14-year low in August, according to
There were 36,500 foreclosure starts in August, compared with 39,200 during July, marking a 7.7% drop, and 48,000 for
At 3.45%, the total delinquency rate for August nearly matched July's 3.46%. In June, there was
There were 253,000 properties in foreclosure presale inventory in August, the fewest since 2005. This was 5,000 properties less than July and 28,000 fewer compared with one year ago.
However, the number of properties where the owners are at least 30 days late with their mortgage payment but not yet in foreclosure rose by 6,000 over July and 4,000 over August 2018 to 1.81 million in August.
The slight decline in the foreclosure rate was a result of growth in the number of active mortgages, which offset the effect of the rise of properties late on their payments, Black Knight said.
Meanwhile, lower interest rates drove prepayment speeds to their highest level in three years. August had a 1.5% prepayment rate, compared with 1.43% in July. August's prepayment speeds also were 91 basis points higher than January's 0.59%, which was an 18-year low.
And a further increase in the prepayment speed is likely when Black Knight reports its data for September, based on closing timelines. The time frame from application to closing is somewhere between 30 and 45 days; recent data from Ellie Mae pegged the time for a refinance to close in August at 39 days.
August prepayment activity reflects what happened with interest rates in June and July. Mortgage interest rates hit
But while the number of borrowers with