The latest Mortgage Banker Association’s (MBA) Forbearance and Call Survey reports that the total number of loans now in forbearance decreased 11 basis points from 3.87% of servicers’ portfolio volume in the prior week to 3.76% as of July 4, 2021. According to MBA’s estimate, 1.9 million homeowners are in forbearance plans. The share of Fannie Mae and Freddie Mac loans in forbearance decreased 8 basis points to 1.91%. Ginnie Mae loans in forbearance decreased 32 basis points to 4.78%, while the forbearance shares for portfolio loans and private-label securities (PLS) increased 2 basis points to 7.94%. The percentage of loans in forbearance for independent mortgage bank (IMB) servicers decreased 13 basis points to 3.87%, and the percentage of loans in forbearance for depository servicers also decreased 13 basis points to 3.98%.
Mike Fratantoni, MBA’s Senior Vice President and Chief Economist, in a statement prepared for the release of the survey said, “Forbearance exits increased in the week of the July 4th holiday to the fastest pace since early April. New requests stayed very low, resulting in a large drop in the share of loans in forbearance, particularly for Ginnie Mae loans, which also continue to be impacted by buyouts of delinquent loans. These loans are tracked as portfolio loans after a buyout.” Fratantoni went onto say that “The mortgage delinquency rate across the entire servicing portfolio declined in June compared to May. However, the delinquency rate slightly increased for homeowners who have completed a workout. Borrowers who are exiting forbearance now are likely to have been in relief for over a year, with almost 60 percent of borrowers in forbearance extensions of longer than 12 months. These borrowers may face more challenges getting back to making regular payments.”
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Share of Mortgage Loans in Forbearance Decreases to 3.76 Percent