Residential Real Estate News
Share of U.S. Mortgages in Forbearance Dips to 4.5 Percent in Mid April
According to the Mortgage Bankers Association's latest Forbearance and Call Volume Survey, the total number of loans now in forbearance decreased by 1 basis point from 4.50% of servicers' portfolio volume in the prior week to 4.49% as of April 18, 2021. According to MBA's estimate, 2.25 million homeowners are in forbearance plans.
The share of Fannie Mae and Freddie Mac loans in forbearance remained the same relative to the prior week at 2.44%. Ginnie Mae loans in forbearance decreased 7 basis points to 6.09%, while the forbearance share for portfolio loans and private-label securities (PLS) increased by 8 basis points to 8.42%. The percentage of loans in forbearance for independent mortgage bank (IMB) servicers remained the same relative to the prior week at 4.72%, and the percentage of loans in forbearance for depository servicers declined 3 basis points to 4.64%.
"After two weeks of large declines, the share of loans in forbearance decreased for the eighth straight week, but by only 1 basis point. New forbearance requests increased, and the rate of exits declined," said Mike Fratantoni, MBA's Senior Vice President and Chief Economist. "More than 40 percent of borrowers in forbearance extensions have now exceeded the 12-month mark."
Key findings of MBA's Forbearance and Call Volume Survey:
- Total loans in forbearance decreased by 1 basis point relative to the prior week: from 4.50% to 4.49%.
- By investor type, the share of Ginnie Mae loans in forbearance decreased relative to the prior week: from 6.16% to 6.09%.
- The share of Fannie Mae and Freddie Mac loans in forbearance remained the same relative to the prior week at 2.44%.
- The share of other loans (e.g., portfolio and PLS loans) in forbearance increased relative to the prior week: from 8.34% to 8.42%.
- By stage, 12.9% of total loans in forbearance are in the initial forbearance plan stage, while 82.4% are in a forbearance extension. The remaining 4.7% are forbearance re-entries.
- Total weekly forbearance requests as a percent of servicing portfolio volume (#) increased relative to the prior week: from 0.05% to 0.06%.
- Of the cumulative forbearance exits for the period from June 1, 2020, through April 18, 2021:
- 26.9% resulted in a loan deferral/partial claim.
- 25.4% represented borrowers who continued to make their monthly payments during their forbearance period.
- 14.6% represented borrowers who did not make all of their monthly payments and exited forbearance without a loss mitigation plan in place yet.
- 14.4% resulted in reinstatements, in which past-due amounts are paid back when exiting forbearance.
- 9.6% resulted in a loan modification or trial loan modification.
- 7.5% resulted in loans paid off through either a refinance or by selling the home.
- The remaining 1.6% resulted in repayment plans, short sales, deed-in-lieus or other reasons.
- Weekly servicer call center volume:
- As a percent of servicing portfolio volume (#), calls increased from the previous week from 7.9% to 8.5%.
- Average speed to answer decreased from 1.4 minutes to 1.2 minutes.
- Abandonment rates increased from 4.6% to 9.6%.
- Average call length remained flat at 8.0 minutes.
- Loans in forbearance as a share of servicing portfolio volume (#) as of April 18, 2021:
- Total: 4.49% (previous week: 4.50%)
- IMBs: 4.72% (previous week: 4.72%)
- Depositories: 4.64% (previous week: 4.67%)
