Mortgage delinquencies rise to 3.53% in August, ICE says; prepayments on 2023-2025 loans fall by 61%

The national mortgage delinquency rate rose 14 basis points to 3.53% in August, Intercontinental Exchange said Monday in its August First Look report, HousingWire reported. ICE said most of the increase came from calendar effects and that the rate was effectively flat once July's calendar-driven drop was accounted for. The rate was 10 basis points higher than a year earlier and 35 basis points below August 2019.

What moved

• Serious delinquencies (90 days or more past due, not yet in foreclosure) rose by 11,000 loans to 574,000, ending a five-month decline. That count is 19% above a year ago. As a share of active loans it was 1.04%, close to the 1.03% August average from 2017 to 2019.
• Foreclosure starts fell 6% from July but were 29% higher than a year earlier. Foreclosure sales were 12% higher on the year but running at just 57% of the August 2019 pace.
• Foreclosure inventory rose by only 2,000 loans, the smallest monthly increase since November 2025, and held at 0.54% of mortgages, matching its highest share since February 2020. It is still up 89,000 loans, or 41%, from a year ago.
• Prepayments, measured by single-month mortality, fell 11 basis points to 0.64%, the lowest in 17 months and the fifth straight monthly decline.

The number behind the number: the refinance wave that stalled

The delinquency headline is the one most coverage will lead with, and ICE itself says it is mostly noise from how the month's days fell. The more useful figure is buried in the prepayment data. Loans originated from 2023 through 2025, the borrowers who took out mortgages at higher rates and were the obvious candidates to refinance, saw their prepayment rate fall to 0.91% in August from a March peak of 2.32%. That is a drop of about 61% in five months.

The reason is not hard to find. Freddie Mac's weekly 30-year average was 7.03% on Sept. 24, up from 6.71% on Sept. 3, and the 10-year Treasury yield that mortgage rates track was near 5.23% on Monday, according to CNBC. September's data will capture that rise; August's already shows refinancing drying up before it.

Who it actually hits

A homeowner who bought in 2023 or 2024 counting on a refinance. On a $400,000 balance, the gap between Freddie Mac's early-September 6.71% and last week's 7.03% is about $86 a month in principal and interest on a new 30-year loan. Every step up in rates narrows the set of recent buyers for whom refinancing still saves money after closing costs.

Loan officers, brokers and title agents who live on refinance volume. Prepayments are the industry's best real-time read on refi activity, and five straight monthly declines mean that pipeline was already shrinking before September's rate jump. Purchase business has to carry more of the load.

Mortgage investors and servicers. Slower prepayments lengthen the life of existing loans. That helps servicers, whose fee income runs as long as the loan stays on the books, and it hurts holders of mortgage bonds bought at a premium, who get their principal back later than planned.

The credit side is steadier than the headline suggests: early-stage delinquencies are about 21,000 loans lower than a year ago, and the serious delinquency rate is in line with pre-pandemic Augusts. The watch point is foreclosure inventory, up 41% on the year even as its monthly growth slows. Rate charts are on our 10-year page.

Sources: ICE August 2026 First Look, via HousingWire; Freddie Mac Primary Mortgage Market Survey; CNBC. The 61% decline and payment figures are our calculations. This is market information, not investment advice.