The number of loans in a state of forbearance is on the rise. The Mortgage Bankers Association’s latest Forbearance and Call Volume Survey shows an increase from 7.54% of servicers’ portfolio volume last week
to 7.91% as of May 3, 2020. The MBA estimates nearly four million homeowners are now in forbearance plans. In comparison, only 0.25% of all loans in the U.S. were in forbearance for the week of March 2.
Leading the pack again were mortgages backed by Ginnie Mae, which had the largest overall share of loans in forbearance by investor type at 10.96%. The share of GSE loans in forbearance increased relative to the prior week, from 5.85% to 6.08%. The number of loans in forbearance for depository servicers rose to 8.75%, while the number of loans in forbearance for independent mortgage bank servicers increased to 7.54%.
“With the calendar turning to May, the share of loans in forbearance increased, but the pace of the increase and incoming forbearance requests continued to slow,” said Mike Fratantoni, MBA’s senior vice president and chief economist. “The dreadful April jobs report showed a decline of more than 20 million jobs, and a spike in the unemployment rate to the highest level since the Great Depression. It will not be surprising if the forbearance numbers continue to rise. As we anticipated, FHA and VA borrowers have been most impacted by the job losses thus far, with the share of Ginnie Mae loans in forbearance at almost 11 percent.”
Weekly servicer call center volume was up, as the percentage of servicing portfolio volume, calls increased from 7.2% to 8.6%. The average speed to answer increased relative to the prior week, from 2.4 minutes to 2.6 minutes, while the average call length increased from 6.9 minutes to 7.4 minutes.
“Although the pace of forbearance requests slowed this week, call volume picked up,” noted Fratantoni, “which could be a sign that more borrowers are calling in to check their options now that May due dates have arrived.”