Forbearance mortgages plunge to 5.2 percent
The latest Mortgage Bankers Association forbearance and call volume survey this week found that the total number of loans currently in forbearance fell 3 basis points from 5.23% of portfolio volume to agents the previous week at 5.20% as of February 28, 2021. According to MBA’s estimate, 2.6 million owners are on the forbearance plan.
The share of Fannie Mae and Freddie Mac loans in forbearance fell to 2.94% – a 3 basis point improvement. Forborne Ginnie Mae loans fell 7 basis points to 7.28%, while the share of forbearance for portfolio loans and private label securities (PLS) increased 2 basis points to 9 , 05%. The percentage of loans in forbearance for managers of independent mortgage banks (IMBs) decreased by 6 basis points to 5.51%, and the percentage of loans in forbearance for depository agents decreased by 1 basis point to 5 , 28%.
“There was a slight decline in the total share of forbearance loans during the last week of February, as the pace of forbearance outflows increased. This continues the trend reported in previous months. abstention, more than 12% were in progress at the end of February, compared to almost 14% at the end of January, “said Mike Fratantoni, senior vice president and chief economist of MBA.” Improving the economy, the plan stimulus package soon to be passed and the many forborne homeowners hitting their plan’s 12-month mark could all influence the overall forbearance share in the coming months. “
Fratantoni added: “Job growth rose sharply in February and the unemployment rate fell, but there are still nearly 10 million unemployed, of which 4.1 million are among the long-term unemployed, or 125 000 more than in January. The adoption of the US bailout provides support for homeowners who continue to struggle through these difficult times. “
Key findings from the MBA forbearance and call volume survey:
- Total forbearance loans decreased by 3 basis points compared to the previous week: from 5.23% to 5.20%.
By type of investor, the share of Ginnie Mae loans in abstention decreased compared to the previous week: from 7.35% to 7.28%.
- The share of Fannie Mae and Freddie Mac loans in forbearance decreased from the previous week: from 2.97% to 2.94%.
- The share of other loans (eg portfolio loans and PLS loans) withheld increased compared to the previous week: from 9.03% to 9.05%.
- By stage, 14.6% of the total forbearance loans are at the initial stage of the forbearance plan, while 82.8% are in extension forbearance. The remaining 2.6% are income from abstention.
- The total weekly forbearance requests as a percentage of the service portfolio volume (#) remained the same compared to the previous week at 0.07%.
- Among the cumulative abstentions for the period from June 1, 2020 to February 28, 2021:
27.7% represented borrowers who continued to make their monthly payments during their forbearance period.
- 25.8% resulted in a loan deferral / partial claim.
- 15.2% resulted in reinstatements, in which the overdue amounts are reimbursed upon termination of the abstention.
- 13.8% represented borrowers who had not made all of their monthly payments and walked out of forbearance without a loss mitigation plan still in place.
- 8.0% resulted in a loan modification or a trial loan modification.
- 7.6% resulted in loans being repaid either by refinancing or by selling the house.
- The remaining 1.8% resulted in redemption plans, short sales, acts in lieu or other reasons.
- Weekly volume of the service call center:
- As a percentage of service portfolio volume (#), calls increased from the previous week, from 7.9% to 8.7%.
- Average response speed increased from 3.0 minutes to 2.6 minutes.
- Drop-out rates fell from 7.6% to 6.1%.
- Average call duration fell from 8.2 minutes to 8.1 minutes.
- Forbidden loans in proportion to the volume of the management portfolio (#) as of February 28, 2021:
- Total: 5.20% (previous week: 5.23%)
- BMI: 5.51% (previous week: 5.57%)
- Custodians: 5.28% (previous week: 5.29%)