A report covering 23% of all residential mortgage debt outstanding showed that 95% of loans were current and performing at the end of the second quarter of this year, up from 91.1% at the end of the second quarter of 2020 – the first quarter of the COVID-19 pandemic.
The report from the Office of the Comptroller of the Currency (OCC) is based on data as of June 30, 2021, from banks servicing some 12.8 million first-lien residential mortgage loans with $2.59 trillion in unpaid balances.
The OCC report shows that:
- The percentage of seriously delinquent mortgages – those 60 or more days past due and all mortgages held by bankrupt borrowers whose payments are 30 or more days past due – was 3.8% in the second quarter of 2021, compared to 4.6% in the prior quarter and 6.8% a year ago.
- Servicers initiated 592 new foreclosures during the second quarter of 2021, a 28.9% decrease from the previous quarter and a 137.8% increase from a year ago. Events associated with the COVID-19 pandemic, including foreclosure moratoriums, have significantly affected these metrics.
- Servicers completed 39,599 mortgage modifications in the second quarter of 2021, a decrease of 17.1% from the previous quarter. Of the 39,599 mortgage modifications, 53.3% reduced borrowers’ monthly payments and 97.2% were “combination modifications” – modifications that included multiple actions affecting affordability and sustainability of the loan, such as an interest rate reduction and a term extension.