The portion of first-lien mortgages that were current and performing declined 5 percentage points in the second quarter of 2020, year over year, according to a report released Wednesday by the Office of the Comptroller of the Currency (OCC).
The OCC’s second-quarter Mortgage Metrics Report – which covers 28% of all residential mortgages outstanding in the U.S., totaling $2.96 trillion in principle balances and held by seven reporting banks – also shows a 5.4 percentage point decline in from the first to second quarters of 2020.
According to the report, 91.1% of mortgages evaluated were current and performing at the end of June, compared with 96.1% a year earlier. Of mortgages in the first-quarter report, 96.5% were current and performing.
Foreclosures initiated and home forfeiture actions, the report states, declined for the quarter and year over year – significantly so due to events associated with COVID-19, including foreclosure moratoriums during the second quarter of 2020: Servicers initiated 249 new foreclosures during the second quarter of 2020, down 98.7% from the previous quarter and down 98.8% from a year ago. There were 1,248 home forfeiture actions during the quarter, including completed foreclosure sales, short sales, and deed-in-lieu-of-foreclosure actions, down 90.1% from a year earlier.
The report also shows the percentage of seriously delinquent mortgages – those 60 or more days past due as well as those held by bankrupt borrowers whose payments are 30 or more days past due – increased 5.4% from the previous quarter and 5.3% from a year ago.
Servicers completed 10,984 mortgage modifications in the second quarter of 2020, the report shows, down 22.9% from the 14,241 modifications reported in the first quarter; 89% of the second-quarter modifications reduced borrowers’ monthly payments.
Loans covered by the report are not a statistically representative, random sample, the report notes.