FHA New Default Rate Drops 15% in June, ICE Data Shows

Federal Housing Administration mortgages serve borrowers who often have smaller down payments or more limited credit profiles, making their performance a closely watched gauge of household financial stress. A decline in newly defaulting loans matters for mortgage servicers because fewer troubled accounts can reduce the cost and workload associated with collections, loss mitigation and loan restructuring.

ICE Mortgage Technology data showed the FHA new default rate fell 15% in June 2026 from a year earlier, the sharpest annual decline in more than four years. The improvement suggests pressure on servicers may be easing as more borrowers progress through trial payment plans and complete loan modifications, reducing the flow of newly distressed mortgages that require intensive servicing.