Key takeaways from this month’s findings include:

• Early-stage delinquencies improved: The national delinquency rate fell by 16 basis points (bps) in December to 3.68% following November’s calendar related high. This is down 3 bps from the same time last year and 26 bps below the December 2019 pre-pandemic benchmark.
• Late-stage delinquencies reached a near two-year high: While earlier-stage delinquencies (30- and 60-day) improved in December, late-stage delinquencies (90+ day) increased by 30,000, reaching their highest level in nearly three years and standing 19,000 above last year’s level.
• Prepayments remain robust: The single month mortality (SMM) rate, which tracks prepayments, rose by 8 bps in December to 0.91%, just 10 bps shy of the October 3.5-year high. Lower interest rates have improved affordability and spurred refinance activity.
• Foreclosure activity trending upward: December’s 40,000 foreclosure starts marks the third highest monthly volume in 2025, up 28% from the year before. Foreclosure inventory is up by 47,000 (+25%) year over year, and foreclosure sales have increased by 2,100 (+41%) from last year's levels.
• Government loans driving foreclosure growth: While foreclosure activity remains muted by historical standards, the number of loans in active foreclosure again hit its highest level since early 2023, driven by a notable rise in FHA foreclosures (+59% YoY) along with a resumption of VA activity following last year's moratorium.