According to the latest Forbearance and Call Volume Survey from Mortgage Bankers Association (MBA), the total number of loans in forbearance decreased by 11 basis points. Forbearance accounted for 3.87% of servicers' portfolio volume in the prior week, but dropped to 3.76% as of July 4, 2021. Currently, there are a total of 1.9 million homeowners in forbearance plans.
“The mortgage delinquency rate across the entire servicing portfolio declined in June compared to May,” according to Mike Fratantoni, MBA's senior vice president and chief economist. “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.”
Key findings from the survey taken between June 28 and July 4, 2021 show that the share of loans in forbearance decreased from from 3.87% to 3.76%. Looking at loans in each stage of forbearance, 10.8% are in the initial forbearance plan stage, while 82.7% are in a forbearance extension. The remaining 6.5% are forbearance re-entries.
The share of Ginnie Mae loans in forbearance decreased from the prior week, 5.10% to 4.78%. The share of Fannie Mae and Freddie Mac loans in forbearance decreased from the prior week, 1.99% to 1.91%. The share of other loans in forbearance increased from the prior week, 7.92% to 7.94%. Weekly forbearance requests as a percentage of servicing portfolio volume remained the same from the previous week at 0.04%.
The cumulative forbearance exits that took place between June 1 and July 4, 2021, nearly 28% resulted in a loan deferral and partial claim. Around 23% represented borrowers who continued to make their monthly payments during their forbearance period. Meanwhile, 15.5% represented borrowers who did not make all of their monthly payments, and 13.5% resulted in reinstatements.
MBA's latest Forbearance and Call Volume Survey represents 74% of the first-mortgage servicing market. For the full report, go to www.mba.org/fbsurvey.
