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Share of Mortgages In Forbearance Stayed Flat In November

Sarah Wolak
Dec 20, 2022
Forbearance

Most vulnerable homeowners have FHA, VA, or other government loans.

KEY TAKEAWAYS
  • MBA estimates that 350,000 homeowners are in forbearance plans.
  • The share of Fannie Mae and Freddie Mac loans in forbearance increased by 1 basis point to 0.32%. 

The number of loans in forbearance in November remained flat from a month earlier, the Mortgage Bankers Association (MBA) said Monday.

The MBA's monthly Loan Monitoring Survey found that the total number of loans in forbearance as of Nov. 30 was 0.7%, unchanged from October.

According to MBA’s estimate, 350,000 homeowners are in forbearance plans. The share of Fannie Mae and Freddie Mac loans in forbearance increased by 1 basis point to 0.32%. 

Ginnie Mae loans in forbearance increased 5 basis points to 1.46%, while the forbearance share for portfolio loans and private-label securities (PLS) declined 6 basis points to 0.97%.

By stage, 37.8% of total loans in forbearance are in the initial forbearance plan stage, while 50.1% are in a forbearance extension.

“There were pockets of weakness in the November data, despite the forbearance rate remaining unchanged and the overall loan performance of serviced loans staying mostly flat,” said Marina Walsh, CMB, MBA’s vice president of industry analysis. “The forbearance rate for Ginnie Mae loans increased for the fourth consecutive month, and the overall performance of the portfolio declined for the third consecutive month. Furthermore, the performance of government post-forbearance workouts also weakened.”

She added, “With many indicators pointing to a recession and higher unemployment in 2023, many of the most vulnerable homeowners will be those with FHA, VA, or other government loans. Loss mitigation options may help to ease the financial hardship for these homeowners.”

Total loans serviced that were current — meaning not delinquent or in foreclosure — as a percent of servicing portfolio volume decreased slightly to 95.69% in November 2022 from 95.7% a month earlier.

The five states with the highest share of loans that were current as a percent of servicing portfolio are Washington, Idaho, Colorado, Utah, and Oregon. 

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