From the General

Counsel's Desk

Foreclosure filings are up 132% from a year prior. Here’s what that means for the housing market (and it’s not what you might think).

When we were reading through real-estate data this month, three stats caught our eye. The first: that the number of active foreclosures (this is when the foreclosure process has begun on a seriously delinquent loan, but it has yet to be completed and liquidated) edged up by more than 7,000 in March — the first year-over-year increase in almost 10 years, according to mortgage technology, data and analytics provider Black Knight. Secondly, more than 78,000 U.S. properties had a foreclosure filing during the first quarter of 2022, which is up 39% from the previous quarter and up 132% from a year ago, according to real-estate analytics company ATTOM. And third, serious mortgage delinquencies — those 90 or more days past due — are 70% higher than they were pre-pandemic, according to Black Knight. 

Mortgage Rates Keep Climbing

As Inventory Levels Slowly Expand

More homebuyers were taking out mortgages despite climbing rates while the tight housing inventory is showing signs of improving. Nonetheless, many homebuyers are not optimistic about the housing market’s near future.

On The Homebuying Front: Freddie Mac reported the 30-year fixed-rate mortgage averaged 5.30% as of May 12, up from last week when it averaged 5.27% — one year ago at this time, it averaged 2.94%. The 15-year fixed-rate mortgage averaged 4.48%, down from last week when it averaged 4.52% — it averaged 2.26% one year earlier. And the 5-year Treasury-indexed hybrid adjustable-rate mortgage averaged 3.98%, up from last week when it averaged 3.96% and up from last year when it averaged 2.59%.

Something big is happening in the housing market

Seriously Delinquent Borrowers Struggling to Recover

According to CoreLogic, the nation’s delinquency rate in the U.S. in February 2022 hit its lowest recorded point since at least January 1999, as found in its monthly Loan Performance Insights Report. 

In February of this year, some 3.2% of all mortgages in the country were in some stage of delinquency, as defined as being at least 30 days past due. Compared to February 2021, this is a 2.5 percentage point drop from the original 5.7%. 

Nearly Half of U.S. Mortgaged Residential Properties Considered Equity-Rich

ATTOM released its Q1 of 2022 U.S. Home Equity & Underwater Report, showing that 44.9% of mortgaged residential properties throughout the U.S. were considered equity-rich in the first quarter, meaning that the combined estimated amount of loan balances secured by those properties was no more than 50% of their homes estimated market values.

The portion of mortgaged homes that were equity-rich in the first quarter of 2022 inched close to half, up from 41.9% in Q4 of 2021 and from 31.9% in Q1 of 2021.

Today’s national mortgage & refinance rates,

May 13th, 2022: Rates rise

The average rate for a 30-year fixed mortgage is 5.57 percent, an increase of 15 basis points since the same time last week. Last month on the 13th, the average rate on a 30-year fixed mortgage was lower, at 5.07 percent.

At the current average rate, you’ll pay a combined $569.04 per month in principal and interest for every $100k you borrow. That’s an extra $7.51 compared with last week.

Commercial and Multifamily Lending Surged in Q1

The volume of commercial and multifamily mortgage loan originations jumped 72 percent in the first quarter of 2022 compared to a year earlier. The Mortgage Bankers Association (MBA) said lenders reported solid increases in all categories of that lending with hotel properties leading the way at 359 percent. While multifamily lending was in fifth place, it still grew 57 percent, behind industrial properties at 145 percent, retail and health care properties (88 and 81 percent, respectively.) Office properties lending increased 30 percent.