Are things returning to pre-pandemic norms, or is trouble on the horizon?
The headline numbers from the latest mortgage performance data look reassuring. The national delinquency rate held steady at 3.35% in April, unchanged from March and still below pre-pandemic levels. Early-stage delinquencies are down from a year ago, and cure activity has rebounded for two consecutive months.
But according to the April 2026 ICE First Look at Mortgage Performance, foreclosure starts jumped nearly 26% year over year in April, with 37,000 starts recorded. The number of loans in active foreclosure rose to 276,000, up 32% from a year ago and above the pre-pandemic count for a second consecutive month. Late-stage delinquencies (loans 90 or more days past due) are climbing even as early-stage numbers improve.
The picture raises a question the data itself does not fully answer: are we returning to normal, or heading somewhere worse?
Mirza Hodzic, managing director and founder of BlackWolf, a mortgage servicing consulting firm, leans toward the first answer, but not without conditions.
"I think I'm leaning more towards a normalization," Hodzic told Mortgage Professional America. "I think we've had low foreclosure activity, low delinquency post-COVID, and I think we're seeing things normalize. However, it doesn't mean, in my opinion, that one should not prepare for it."
What the data is really saying
The headline stability is real, but Hodzic said there is more going on beneath it. Early delinquencies are resolving, but late-stage pressure is moving in the other direction.
"From a surface-level view, things look fairly stable from the delinquency standpoint," he said. "However, if you dig into it a bit deeper and start looking at details, you start to see some pressure around late-stage delinquencies and foreclosure starts. While it's great that we're seeing early delinquencies being resolved and getting brought current, the bigger risk, the more worrying type of delinquencies are creeping back up."
While cures have rebounded, April and May often see a bounce-back. Tax refund season tends to help borrowers get current in the early months of the year, and that timing may be doing some of the work.
"To keep in mind that we're around tax season, so people getting refunds, people getting their annual bonuses at the beginning of the year, that might have some role in it as well," he said.
Of course, the overall economic picture has to be considered when looking at potential delinquency impact. With inflation on the rise, household budgets are getting tighter. Hodzic said he is not ready to call it a crisis, but he is watching it closely.
"Trying to stay positive and say no," he said. "But people are correct when they say that these economic stressors regarding taxes and insurance rates going up, budgets being tight, could get to a point where it's worse than before. We're not there yet, where I'm still concerned, but it's definitely something to keep an eye on to make sure that folks are getting the right workouts and everything else to make sure that those things get addressed early in the cycle rather than later."
What this means for brokers
For brokers, the delinquency data points to an opportunity with existing clients. Home equity has been building for years, and Hodzic said brokers who understand what options are available can help borrowers navigate pressure before it turns into a default.
"I always advocate for that," he said. "It's currently a bit of an underused area for brokers where you can definitely help your current clients out by making them understand what options they have. It's not just them working directly with the servicer or going out and doing the research themselves. The broker can do a lot of that because brokers are knowledgeable folks and they know what's out there."
Kimber White, president of the National Association of Mortgage Brokers (NAMB), has also mentioned that refinances can help overcome a mountain of consumer debt. Even with rates still elevated, there are borrowers in existing clients' pipelines who could benefit from a refinance today.
"There is a refi market," White told Mortgage Professional America in May. "When it comes to the refi, a lot of people have gotten in debt. You need to go back to your referral market and look at what you can do. And just know that there are a lot of people who are over 6% now."
White said the clients are already there for brokers willing to make the call.
"Go back to your previous clients," White said. "You've still got clients that were well over 7%. Talk to them, get them refinanced. You've got people who were in the 8s."
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