ICE First Look At Mortgage Performance: Increased Refinance Activity Drives Mortgage Prepayments Back Toward 3.5-Year High

ICE Mortgage Technology, neutral provider of a robust end-to-end mortgage platform and part of Intercontinental Exchange, Inc. (NYSE: ICE), today released the December 2025 ICE First Look at mortgage delinquency, foreclosure and prepayment trends.

“December’s numbers show that lower interest rates drove refinance activity and prepayments to near multi-year highs,” said Andy Walden, Head of Mortgage and Housing Market Research at ICE. “At the same time, there was a divergence in delinquency trends, with early-stage delinquencies improving and late-stage delinquencies continuing to rise. Foreclosure activity also increased, driven mainly by FHA and VA loans.”

Key takeaways from this month’s findings include:

• Early-stage delinquencies improved: The national delinquency rate fell by 16 basis points (bps) in December to 3.68% following November’s calendar related high. This is down 3 bps from the same time last year and 26 bps below the December 2019 pre-pandemic benchmark.
  
  
• Late-stage delinquencies reached a near two-year high: While earlier-stage delinquencies (30- and 60-day) improved in December, late-stage delinquencies (90+ day) increased by 30,000, reaching their highest level in nearly three years and standing 19,000 above last year’s level.
  
  
• Prepayments remain robust: The single month mortality (SMM) rate, which tracks prepayments, rose by 8 bps in December to 0.91%, just 10 bps shy of the October 3.5-year high. Lower interest rates have improved affordability and spurred refinance activity.
  
  
• Foreclosure activity trending upward: December’s 40,000 foreclosure starts marks the third highest monthly volume in 2025, up 28% from the year before. Foreclosure inventory is up by 47,000 (+25%) year over year, and foreclosure sales have increased by 2,100 (+41%) from last year's levels.
  
  
• Government loans driving foreclosure growth: While foreclosure activity remains muted by historical standards, the number of loans in active foreclosure again hit its highest level since early 2023, driven by a notable rise in FHA foreclosures (+59% YoY) along with a resumption of VA activity following last year's moratorium.

Data as of December 31, 2025
Total U.S. loan delinquency rate (loans 30 or more days past due, but not in foreclosure): 3.68%
Month-over-month change: -4.20%
Year-over-year change: -0.93%

Total U.S. foreclosure pre-sale inventory rate: 0.44%
Month-over-month change: 5.71%
Year-over-year change: 22.86%

Total U.S. foreclosure starts: 40,000
Month-over-month change 53.96%
Year-over-year change: 27.74%

Monthly prepayment rate (SMM): 0.91%
Month-over-month change: 9.92%
Year-over-year change: 59.15%

Foreclosure sales: 7,100
Month-over-month change: 6.68%
Year-over-year change: 40.77%

Number of properties that are 30 or more days past due, but not in foreclosure: 2,025,000
Month-over-month change: -89,000
Year-over-year change: 9,000

Number of properties that are 90 or more days past due, but not in foreclosure: 560,000
Month-over-month change: 30,000
Year-over-year change: 19,000

Number of properties in foreclosure pre-sale inventory: 239,000
Month-over-month change: 13,000
Year-over-year change: 47,000

Number of properties that are 30 or more days past due or in foreclosure: 2,265,000
Month-over-month change: -76,000
Year-over-year change: 56,000

*Non-current totals combine foreclosures and delinquencies as a percent of active loans in that state.

Notes:

1. Totals are extrapolated based on ICE’s loan-level database of mortgage assets.
2. All whole numbers are rounded to the nearest thousand, except foreclosure starts and sales, which are rounded to the nearest hundred.

The company will provide a more in-depth review of this data in its monthly Mortgage Monitor report, which includes an analysis of data supplemented by detailed charts and graphs that reflect trend and point-in-time observations. The Mortgage Monitor report is available online at https://www.icemortgagetechnology.com/resources/data-reports.

For more information about gaining access to ICE’s loan-level database, please send an email to ICE-MortgageMonitor@ice.com.