According to the Mortgage Bankers Association, the total number of loans now in forbearance fell by 7 basis points from 5.29% portfolio volume to 5.22% as of February 14th.
This translates into approximately 2.6 million homeowners that are in forbearance.
The share of Fannie Mae and Freddie Mac loans in forbearance also decreased slightly by 4 basis points. Even Ginnie Mae loans fell by 2 basis points to 7.32%.
Definitely this is an encouraging sign within the mortgage market, as for the third week in a row there has been a decline in the percent of mortgages in forbearance. In addition, requests for new forbearances have dropped 6 basis points.
This is always good news as the trend continues to point to a more healthy market.
Within the context of this very strong market, the strong home sales, the shortage of inventory and the inability of contractors to provide additional properties for sale give the overall market a stability that it might not have otherwise.
Here are some of the metrics from the report issued by the Mortgage Banker’s Association:
■ Total loans in forbearance decreased by 7 basis points relative to the prior week: from 5.29% to 5.22%.
■ By investor type, the share of Ginnie Mae loans in forbearance decreased relative to the prior week: from 7.34% to 7.32%.
■ The share of Fannie Mae and Freddie Mac loans in forbearance decreased relative to the prior week: from 3.01% to 2.97%.
■ The share of other loans (e.g., portfolio and PLS loans) in forbearance decreased relative to the prior week: from 9.14% to 8.94%.
■ By stage, 15.9% of total loans in forbearance are in the initial forbearance plan stage, while 81.6% are in a forbearance extension. The remaining 2.5% are forbearance re-entries.
■ Total weekly forbearance requests as a percent of servicing portfolio volume (#) decreased relative to the prior week: from 0.07% to 0.06%.
■ Of the cumulative forbearance exits for the period from June 1, 2020, through February 14, 2021:
■ 27.9% represented borrowers who continued to make their monthly payments during their forbearance period.
■ 25.8% resulted in a loan deferral/partial claim.
■ 15.4% resulted in reinstatements, in which past-due amounts are paid back when exiting forbearance.
■ 13.8% represented borrowers who did not make all of their monthly payments and exited forbearance without a loss mitigation plan in place yet.