ICE discovered that total mortgage efficiency was robust in October, with the nationwide delinquency fee falling by 7 foundation factors (bps) to three.34%. That’s down 11 bps from the identical time final 12 months and 53 bps under the October 2019 pre-pandemic benchmark.
Andy Walden, ICE’s head of mortgage and housing market analysis, mentioned modest fee reduction this fall sparked a soar in mortgage applications and added to the robust efficiency.
“We’re now seeing the best focus of rate-and-term refinances in practically 5 years, nearly solely pushed by debtors holding 2023-2025 classic loans,” he mentioned. “Notably, the market has develop into extra fee delicate as tons of of 1000’s of debtors transfer out and in of refinance incentive with small day by day fee shifts.”
Nonbank servicers retained debtors at practically thrice the speed of banks — 35% in comparison with 13%. Retention was highest for Federal Housing Administration (FHA) and U.S. Department of Veterans Affairs (VA) loans at 36%, adopted by loans backed by Fannie Mae and Freddie Mac at 25%. Privately securitized loans noticed the bottom retention at 6%.
Charge-and-term refinances made up 62% of all refi exercise in October, the best share in nearly 5 years, ICE mentioned. Almost all (95%) rate-and-term refis in September and October concerned debtors with 2023–25 classic loans.
These debtors carried a median mortgage stability of $505,000 and a credit score of 762, they usually reduce their mortgage charges by a median of 0.92 share factors, saving roughly $200 monthly.
Residence fairness mortgage and residential fairness line of credit score (HELOC) exercise additionally elevated. Second-lien residence fairness mortgage withdrawals rose to their highest stage since 2007 within the third quarter, as householders with low-rate first mortgages seemed for alternate options to tapping fairness with out refinancing their main mortgage.
Improved affordability additionally performed a task, helped by tighter Treasury yield spreads. The ICE report mentioned that every one 100 main U.S. metro areas have seen affordability enhance 12 months over 12 months.
Common mortgage rates hovered round 6.25% in mid-November, placing the month-to-month cost on a median-priced residence at roughly $2,126, or 29.7% of the median family earnings. ICE mentioned that though that’s nonetheless excessive by historic requirements, it’s the bottom share since early 2023.
“ICE’s 2025 Borrower Insights Survey discovered that 78% of debtors solely store one or two choices earlier than selecting a lender,” mentioned Tim Bowler, president of ICE Mortgage Know-how. “In a delicate fee surroundings, this restricted procuring habits amplifies the significance of being first to succeed in motivated debtors.”
Foreclosure activity stays traditionally low however is rising, ICE discovered. About 79,000 loans entered foreclosures between October and November, which is 15% under 2019 ranges however the highest two-month whole in additional than 5 years.
Energetic foreclosures stock is up 20% from a 12 months earlier, and October’s 7,700 foreclosures gross sales marked a five-year excessive, though it’s nonetheless 40% under pre-pandemic ranges.
FHA and VA loans are driving the rise, accounting for 85% of recent begins and practically all progress in energetic circumstances and gross sales. FHA foreclosures are up about 30,000 from final 12 months, whereas VA foreclosures have risen by roughly 12,000.
