Newer mortgages account for nearly half of foreclosures

🧙‍♀️ Witching you a magical Friday. Today’s newsletter is 666 words, a 2.5-minute read.

1. Newer mortgages account for nearly half of foreclosures

Mortgages originated in 2022 or later accounted for 49% of completed U.S. foreclosure sales in September and 46% of third-quarter foreclosure auctions, according to ICE and Auction.com.

• Foreclosure auction volume involving these newer loans jumped 73% year over year, while overall completed auctions rose 25%, marking the seventh consecutive quarter of annual growth and the highest quarterly volume since early 2020.

• Foreclosure auctions involving FHA loans climbed 73% year over year in Q3, accounting for 43% of all auctions, the highest share since 2015.

• Active foreclosure inventory also rose 37% year over year in September to its highest level since early 2019.

• The national mortgage delinquency rate remained relatively low at 3.66% in September, below pre-pandemic levels.

2. Enterprise Bank & Trust exits mortgage origination business

Enterprise Bank & Trust is exiting mortgage origination to cut costs and focus on business lines where it can achieve greater scale. CEO Jim Lally confirmed the decision during the bank’s Q3 earnings call, saying it was eliminating operations that were not adding sufficient value.

The move follows Northpointe Bank’s decision to sell its distributed retail and consumer-direct mortgage channels to CMG Financial. Unlike Northpointe, Enterprise has not announced a buyer or referral partner for its mortgage business.

Despite the exit, Enterprise’s broader loan portfolio grew 6.6% year over year to $12.3 billion in the third quarter, while net income fell 6.2% to $42.4 million.

A MESSAGE FROM THE RUNDOWN AI

Learn AI in 5 minutes a day

You don't have to scroll every AI thread, track every new tool, or watch every demo. 

The Rundown AI breaks it all down for you — the latest AI news, tools, and tutorials in one free 5-minute email every morning. 

Trusted by 2M+ professionals at Apple, Google, and NASA.

Sign up to start learning.

3. More Nuggets

⬆️ Compass raises production standards for new agents by 30%. (RISMedia)

⚠️ Fed holds interest rates steady as inflation pressures persist. (FedReserve)

🔐 Homeowners hold $11.6 trillion in rate-locked home equity. (FirstAmerican)

📅 Mandatory transition to the new Uniform Appraisal Dataset (UAD) 3.6 format takes effect Nov. 2. (NMP)

🚀 Rocket Companies reports $709 million third-quarter profit. (Rocket)

4. CrossCountry reports $2,500 in savings from VantageScore 4.0

CrossCountry Mortgage estimates that eligible borrowers saved an average of $2,500 per transaction after the lender adopted VantageScore 4.0. During the first 60 days of implementation, loans receiving more favorable credit scores under the model saw an average 62-basis-point reduction in loan-level price adjustments (LLPAs), based on preliminary company data. The savings apply only to qualifying borrowers, not the lender’s entire portfolio.

The lender also removed its previous 80% loan-to-value (LTV) cap for eligible Fannie Mae and Freddie Mac loans, expanding access to borrowers with down payments below 20%. It is also broadening its VA lending options for eligible veterans and active-duty service members.

The changes follow the Federal Housing Finance Agency’s approval of VantageScore 4.0 as an alternative to Classic FICO for eligible loans sold to Fannie Mae and Freddie Mac. Rocket Mortgage previously reported average closing-cost savings of about $1,600 among borrowers who benefited from the alternative scoring model.

5. FICO weighs subscription pricing for mortgage scores

FICO is developing a subscription-based pricing model for mortgage lenders in 2027, adding another option to its credit score offerings, according to HousingWire sources.

The proposed model would charge lenders an annual fee paid monthly, with costs based on their mortgage volume in the previous year. FICO has reportedly begun discussing the offering with industry partners but has not announced an official name or pricing.

The subscription would complement FICO’s Preferred Program, which locks per-score pricing at $10 for lenders that pull FICO scores on every loan file. The program also includes FICO 10T at no additional charge. Lenders can alternatively use VantageScore 4.0, which is priced at 99 cents per score through participating credit bureaus.

☀️ You’re all caught up. See you on Monday!

🚀 Wanna help our newsletter grow? Forward it to a friend or colleague.

Would you like to receive a ready-to-send weekly marketing email for your realtors and/or clients? Start your 30-day free trial here.

Was this email forwarded to you? Subscribe here.