Mortgage bankers Association (MBA) monthly Loan Monitoring Survey for March revealed that the total number of loans now in forbearance fell 13 basis points from 1.18% of servicers’ portfolio volume to 1.05%. The MBA estimates that a total of 525,000 homeowners are in forbearance.
The share of Fannie Mae and Freddie Mac loans in forbearance decreased 7 basis points to 0.49%. Ginnie Mae loans in forbearance decreased 12 basis points to 1.38% and the forbearance share for portfolio loans and private-labels securities (PLS) declined 28 basis points to 2.44%.
“March was another month of lower forbearance rates, and a higher share of overall loans and forbearance-related workout loans that are current,” said MBA Vice President of Industry Analysis Marina Walsh. “The share of loans in forbearance continues to dwindle and is just 5 basis points shy of hitting 1 percent - or 500,000 homeowners - after peaking at 4.3 million borrowers in June 2020. It has been a remarkable recovery for many homeowners in less than two years.”
By stage, 29.7% of total loans in forbearance are in the initial forbearance plan stage, while 57.2% are in a forbearance extension. The remaining 13.1% are forbearance re-entries, including re-entries with extensions.
Out of the cumulative forbearance exits from June 1, 2020 through March 31, 2022, 29% resulted in loan deferral or partial claim; 18.9% represented borrowers who continued to make their monthly payments during their forbearance period; 17.1% represented borrowers who did not make all their monthly payments and exited forbearance without a loss mitigation plan in place; 15.4% resulted in loan modification or trial loan modification; 11.4% resulted in reinstatements (in which past amounts are paid back when exiting forbearance); 6.7% resulted in loan paid off through either a refinance or by selling the home.
Total current loans, meaning they are neither delinquent or in forbearance, as a percentage of servicers’ portfolio volume rose to 95.47% in March 2022 from 94.94% in February 2022 (on a seasonally adjusted basis).
The five states with the highest share of current loans as a percentage of servicers’ portfolio were Idaho, Washington, Colorado, Utah, Oregon.
The five states with the lowest share of current loans as a percentage of servicers’ portfolio were Louisiana, Mississippi, New York, West Virginia, and Oklahoma.
Total completed loan workouts from 2020 onward — including repayment plans, loan deferrals/partial claims, loan modifications — that were current as a percentage of total completed workouts rose to 83.67% last month from 82.26% in February.
