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MBA Survey: "Share of Mortgage Loans in Forbearance Slightly Decreases to 3.25%"

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by Calculated Risk on 8/23/2021 04:00:00 PM

Note: This is as of August 15th.

From the MBA: Share of Mortgage Loans in Forbearance Slightly Decreases to 3.25%

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 3.26% of servicers’ portfolio volume in the prior week to 3.25% as of August 15, 2021.
According to MBA’s estimate, 1.6 million homeowners are in forbearance plans.

The share of Fannie Mae and Freddie Mac loans in forbearance decreased 3 basis points to 1.66%.
Ginnie Mae loans in forbearance decreased 3 basis points to 3.92%, while the forbearance share for
portfolio loans and private-label securities (PLS) increased 10 basis points to 7.15%. The percentage of
loans in forbearance for independent mortgage bank (IMB) servicers increased 2 basis points to 3.48%,
and the percentage of loans in forbearance for depository servicers decreased 1 basis point to 3.35%.

“The share of loans in forbearance was little changed, as both new requests and exits were at a slower
pace compared to the prior week. In fact, exits were at their slowest pace in over a year,” said Mike
Fratantoni, MBA’s Senior Vice President and Chief Economist. “There were more new forbearance
requests and re-entries for portfolio and PLS loans, leading to a 10-basis-point increase in their share.
Portfolio and PLS loans now account for almost 50% of all depository servicer loans in forbearance and
almost 40% of IMB servicer loans in forbearance, which highlights the importance of this investor
category.”
emphasis added

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 (#) decreased relative to the prior week: from 0.06% to 0.05%.%”

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