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Forbearance exits have reached the fastest pace in six months, a pace that the Mortgage Bankers Association expects to continue in the coming weeks.
The MBA’s Forbearance and Call Volume Survey showed that the total number of loans in forbearance decreased by 15 basis points from 3.23 percent of servicers’ portfolio volume in the prior week to 3.08 percent as of Sept. 5. The MBA estimates that 1.5 million homeowners are in forbearance plans.
The share of Fannie Mae and Freddie Mac loans in forbearance decreased 11 basis points to 1.52 percent. Ginnie Mae loans in forbearance decreased 24 basis points to 3.39 percent, while the forbearance share for portfolio loans and private-label securities (PLS) decreased 25 basis points to 7.27 percent. The percentage of loans in forbearance for independent mortgage bank (IMB) servicers decreased 16 basis points to 3.33 percent, and the percentage of loans in forbearance for depository servicers decreased 18 basis points to 3.15 percent.
The MBA said 10.7 percent of total loans in forbearance are in the initial forbearance plan stage, while 81.1 percent are in a forbearance extension and 8.2 percent are forbearance re-entries.
“The share of loans in forbearance decreased by 15 basis points last week, as forbearance exits jumped to their fastest pace since March. The fast pace of exits outweighed the slight increase in new forbearance requests and re-entries,” Mike Fratantoni, MBA’s senior vice president and chief economist, said in a statement. “Servicer call volume jumped last week as summer came to an end and many borrowers reached the end of their forbearance terms. We anticipate a similarly fast pace of exits in the weeks ahead, which should lead to increased call volume and a further decline in the forbearance share.”
Calls to mortgage servicers increased from 5.8 percent of servicing portfolio volume in the prior week to 7.7 percent.
