The Mortgage Bankers Association's Forbearance and Call Volume Survey reported that the number of loans currently in forbearance decreased from 4.96% to 4.90% as of March 28, 2021.
According to the MBA, the share of Fannie Mae and Freddie Mac loans in forbearance decreased to 2.72%, Ginnie Mae loans in forbearance decreased to 6.78% and the forbearance share for portfolio loans and private-label securities decreased to 8.80%. Meanwhile, the percentage of loans in forbearance for independent mortgage bank servicers decreased to 5.18%.
The report also revealed that 13.7% of total loans in forbearance are in the initial forbearance plan stage, while 84.1% are in a forbearance extension. The remaining 2.2% are forbearance re-entries.
"The share of loans in forbearance decreased for the fifth straight week, and new forbearance requests dropped to their lowest level since March 2020. The share of loans in forbearance also decreased for all three investor categories," said Mike Fratantoni, MBA's senior vice president and chief economist. "More than 21% of borrowers in forbearance extensions have now exceeded the 12-month mark. Of those that exited forbearance in March, more than 21% received a modification, indicating that their income had declined and they could not afford their original mortgage payment."
"March was a turning point for the economy, with hiring shifting into a higher gear and the unemployment rate continuing to decline. However, there are still more than 4.2 million people who have been actively looking for work for more than six months. Homeowners who are still facing hardships and need to extend their forbearance term should contact their servicer," added Fratantoni.
According to a recent report from Real Estate Witch, 43% of 1,000 respondents said that they had no emergency savings and 38% accumulated personal debts of $3,000 or more in the past year, further proving that there are still a large number of folks who are struggling financially.
However, the report also states that as vaccines become increasingly available, Americans are beginning to feel more optimistic about economic recovery.
Click here to read more from the MBA's latest Forbearance and Call Volume Survey.
