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MBA Survey: "Share of Mortgage Loans in Forbearance Slightly Decreases to 4.18%"

by Calculated Risk on 6/01/2021 04:00:00 PM

Note: This is as of May 23rd.

From the MBA: Share of Mortgage Loans in Forbearance Slightly Decreases to 4.18%

The Mortgage Bankers Association’s (MBA) latest Forbearance
and Call Volume Survey revealed that the total number of loans now in forbearance decreased by 1
basis point from 4.19% of servicers’ portfolio volume in the prior week to 4.18% as of May 23, 2021.
According to MBA’s estimate, 2.1 million homeowners are in forbearance plans.

The share of Fannie Mae and Freddie Mac loans in forbearance decreased 2 basis points to 2.19%.
Ginnie Mae loans in forbearance decreased 4 basis points to 5.55%, while the forbearance share for
portfolio loans and private-label securities (PLS) increased 11 basis points to 8.37%. The percentage of
loans in forbearance for independent mortgage bank (IMB) servicers decreased 2 basis points to 4.36%,
and the percentage of loans in forbearance for depository servicers declined 1 basis point to 4.34%.

“The share of loans in forbearance slightly declined, dropping by only 1 basis point, due to a slower pace
of forbearance exits. This was the 13th straight week of declines,” said Mike Fratantoni, MBA’s Senior
Vice President and Chief Economist. “Forbearance re-entries increased to almost 5.6 percent, as more
homeowners who had canceled forbearance needed assistance again. There was also an increase in the
share of PLS and portfolio loans in forbearance, while the share for Fannie Mae, Freddie Mac, and Ginnie
Mae loans decreased.”

Added Fratantoni, “Housing market data continue to paint a picture of strong demand and constrained
supply. The resulting rapid growth in home equity will benefit homeowners, whether they choose to
retain or sell their properties.”
emphasis added

MBA Forbearance Survey Click on graph for larger image.

This graph shows the percent of portfolio in forbearance by investor type over time. Most of the increase was in late March and early April 2020, and has trended down since then.

The MBA notes: “Total weekly forbearance requests as a percent of servicing portfolio volume (#) remained the same relative to the prior week at 0.05%.”

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