Key takeaways:

• Delinquencies rose modestly, remaining below pre-pandemic levels: The national delinquency rate rose 5 basis points (bps) to 3.55% in June, roughly half the typical seasonal rise. The rate remains 60 bps below the June 2019 pre-pandemic benchmark of 4.16%.
• Late-stage delinquencies declined to a six-month low: Serious delinquencies (90-plus days past due but not in foreclosure) fell to 570,000, extending the seasonal improvement that began in March.
• New default activity declined: New default volumes have stabilized in recent months, and new FHA defaults were down 15% year over year in June, their largest annual decline in more than four years.
• Roll rates improved across early delinquency stages: The number of borrowers becoming 30- and 60-days delinquent fell in June on both a monthly and annual basis.
• Foreclosure activity continues to slowly trend higher: The share of mortgages in active foreclosure reached 0.53% in June, the highest level in six years, as foreclosure activity continued to normalize. Foreclosure starts hit a six-year high, and foreclosure sales were up 16% from a year ago, though they remained 46% below pre-pandemic levels.
• Prepayment speeds eased: Single-month mortality (SMM) eased 2 bps to 0.77%, a five-month low, as mortgage rates remained elevated, though June’s SMM remained 12 bps above year-ago levels.