Forbearances Fall Below 5 Percent For The First Time In A Year

Forbearances Fall Below 5 Percent For The First Time In A Year

March 30, 2021
forbearance loans

The Mortgage Bankers Association's Forbearance and Call Volume Survey reported that the share of mortgage loans in forbearance has fallen to 4.96% as of March 21, 2021, down from 5.05% the previous week. The MBA report still estimates that there are 2.5 million homeowners currently in forbearance plans.

Additionally, the report shows that the share of Fannie Mae and Freddie Mac loans in forbearance decreased to 2.77%, down 6 basis points. Ginnie Mae loans in forbearance fell to 6.83% and the forbearance share for portfolio loans and private-labeled securities slipped one basis point to 8.90%. According to the MBA, the percentage of loans in forbearance for independent mortgage bank servicers decreased 14 basis points to 5.23%, while the percentage of loans in forbearance for depository servicers fell to 5.10%.

"The share of loans in forbearance decreased for the fourth straight week, dropping below 5% for the first time in a year. New forbearance requests remained at their lowest level since last March, and the pace of exits increased," said Mike Fratantoni, MBA's senior vice president and chief economist. "More than 17% of borrowers in forbearance extensions have now exceeded the 12-month mark. Many homeowners need this support, even as there are increasing signs that the pace of economic activity is picking up as the vaccine rollout continues. Those who have an ongoing hardship due to the pandemic and want to extend their forbearance beyond the 12-month point need to contact their servicer. Servicers cannot automatically extend forbearance terms without the borrower's consent."

As for weekly servicer call center volume, the report revealed that the percent of servicing portfolio volume calls decreased from the previous week from 9.2% to 8.9%.

Click here to read the full report.

Servicing

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