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MortgagePoint » Your Trusted Source for Mortgage Banking and Servicing News 64 November 2025 J O U R N A L Default Servicing MORTGAGE PERFORMANCE REMAINS STRONG AS FHA FORECLOSURES EDGE HIGHER T he September 2025 ICE First Look on mortgage delinquency, foreclosure, and prepayment trends was published by ICE Mortgage Technology, a division of Intercontinental Exchange, Inc. According to the data, both delin- quencies and foreclosure activity are still below long-term averages, indicating that overall mortgage performance is still historically excellent. Although there are certain changes occurring within the government-backed loan categories, these patterns mostly reflect the stabilization of market conditions rather than wide- spread decline. Key Findings: • FHA loans saw a 44-bps rise in non-current rates, while other loan types improved. • Foreclosure starts hit 103,000 in Q3, up 23% over the same period YoY. • FHA loans now account for 38% of all active foreclosures nationwide. • Overall foreclosure volume remains historically low, with Q3 foreclosure sales at half of 2019 levels. Trends, Statistics & Increasing Resolution Efficiency Although the percentage of loans in active foreclosure increased somewhat from the previous year (18%), the total vol- ume of foreclosures is still at an all-time low, with Q3 foreclosure sales (21,000) being about half of 2019 levels. Most of the increase may be attributed to FHA loans, which account for 80% of the increase in active foreclosures, 38% of active foreclosures, and about half of the annual increase in foreclosure starts. The rest is mostly due to VA foreclosure activity picking back up after the halt last year. "The mortgage market remains remarkably resilient, with mortgage performance continuing to hold up well," said Andy Walden, Head of Mortgage and Housing Market Research at ICE. "Delin- quency rates improved in September, and even as we see increases in activity among FHA loans, we're largely returning to more typical levels following several years of artificially low foreclosure volumes." Top Five States by Non-Concurrent Percentage: 1. Louisiana (7.91%) 2. Mississippi (7.83%) 3. Alabama (5.86%) 4. Indiana (5.55%) 5. Arkansas (5.54%) Bottom Five States by Non- Concurrent Percentage: 1. Hawaii (2.20%) 2. Colorado (2.16%) 3. Montana (2.13%) 4. Washington (2.05%) 5. Idaho (2.03%) Top Five States by 90+ Days Delinquent Percentage: 1. Mississippi (2.07%) 2. Louisiana (1.94%) 3. Alabama (1.51%) 4. Arkansas (1.41%) 5. Indiana (1.30%) More Delinquency Data, Borrower Trends & Rate Changes The following are additional, im- portant conclusions from this month's findings: Delinquencies remain well below pre-pandemic norms: In September, the national delinquency rate dropped 2 basis points (bps) to 3.42%, which was 6 bps lower than the same period the previous year and 58 bps lower than its pre-pan- demic level from September 2019. Strength across delinquency bands in September: Since the great majority of borrowers continue to make their mort- gage payments on time, both early-stage (30-day) and late-stage (90+ day) delin- quencies improved month over month. Non-current rates improved for most investors: GSE (-3 bps), VA (-4 bps), and portfolio-held loans (-17 bps) all saw a year-over-year decrease in the non-cur- rent rate (delinquencies plus active foreclosures). The significant exception was FHA loans, which increased 44 basis points from the previous year. Foreclosure activity is returning to normal ranges: In Q3 2025, 103,000 fore- closures were started, which is 23% more than in the same period the previous year but 18% less than in Q3 2019 before the pandemic. Prepayments are edging higher: As interest rates started to decline in August, repayments increased by 8 basis points in September to a single month mortality (SMM) rate of 0.74%, a 15% rise over the previous year. Note: Totals are extrapolated based on ICE's loan-level database of mortgage assets. All whole numbers are rounded to the nearest thousand, except foreclosure starts and sales, which are rounded to the nearest hundred.