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The number of homeowners in forbearance continued to decline last month, and most of the forbearance exits came from portfolio loans and private-label securities, according to the Mortgage Bankers Association.
In its monthly Loan Monitoring Survey released yesterday, the MBA found that the total number of loans now in forbearance decreased by 7 basis points from 0.81 percent of servicers’ portfolio volume in June to 0.74 percent in July. The MBA estimates that 370,000 homeowners are in forbearance plans.
The share of Fannie Mae and Freddie Mac loans in forbearance decreased 1 basis point to 0.34 percent. Ginnie Mae loans in forbearance remained unchanged from the prior month at 1.26 percent, and the forbearance share for portfolio loans and private-label securities declined 34 basis points to 1.34 percent.
“July continued the ongoing trend in recent months of most of the forbearance exits coming from borrowers with portfolio loans and private label security loans,” Marina Walsh, MBA’s vice president of industry analysis, said in a statement. “There has been very little change in the forbearance rate for Fannie Mae, Freddie Mac, and Ginnie Mae loans during the past three months, perhaps indicating that we have reached a floor, with loans entering forbearance about equal to loans exiting forbearance for these loan types.”
The MBA said that 30.5 percent of total loans in forbearance are in the initial forbearance plan stage compared to 29.6 percent in June. The remaining loans include 56.1 percent that are in a forbearance extension and 13.4 percent that are forbearance re-entries, including re-entries with extensions.
For depository institutions, 0.56 percent of their loan portfolio is in forbearance, down from 0.62 percent in June, while 1 percent of independent mortgage banks’ portfolios is in forbearance, compared to 1.03 percent in June.
The percent of borrowers current on their mortgage – not delinquent or in foreclosure – was 95.59 percent in July, down from 95.71 percent in June.
