"A borrower first misses a payment or two, landing in the 30- or 60-day delinquency bucket. If financial stress persists, they fall further behind-90 to 180 days past due-and only around then does the foreclosure process typically begin."
"Early-stage delinquencies have been ticking upward since 2022, and more serious delinquencies have followed in kind. The pattern is consistent with a housing market slowly normalizing after years of extraordinary intervention."
"Foreclosure and serious delinquency rates cratered to historic lows around 2021. However, in recent quarters, foreclosures have steadily returned, inching closer to pre-pandemic 2019 levels."
The housing market is showing signs of normalization as early-stage delinquencies have increased since 2022. Initially, the federal government implemented a foreclosure moratorium during the COVID-19 pandemic, which kept foreclosure rates low. However, as these protections have ended, delinquencies are rising, with serious delinquencies following suit. Foreclosure activity is inching closer to pre-pandemic levels, particularly after the expiration of protections on VA-backed mortgages. The data indicates that the financial stress previously deferred is now becoming evident.
Read at Fast Company
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