Based on the Mortgage Bankers Association’s latest Forbearance and Call Volume Survey, the total number of loans now in forbearance decreased by 4 basis points from 7.20% of servicers’ portfolio volume in the prior week to 7.16% as of August 30, 2020. According to MBA’s estimate, 3.6 million homeowners are in forbearance plans.
The share of Fannie Mae and Freddie Mac loans in forbearance dropped for the 13th week in a row to 4.80% – an 8-basis-point improvement. Ginnie Mae loans in forbearance increased by 4 basis points for the second consecutive week to 9.62%, while the forbearance share for portfolio loans and private-label securities (PLS) decreased by 1 basis point to 10.43%. The percentage of loans in forbearance for
depository servicers decreased 9 basis points to 7.40%, while the percentage of loans in forbearance for independent mortgage bank (IMB) servicers remained unchanged at 7.41%.
“The share of Ginnie Mae loans in forbearance increased again this week, as the current economic crisis continues to disproportionately impact borrowers with FHA and VA loans. As a result, IMB servicers, which have roughly one-third of their portfolio with Ginnie Mae, had a forbearance share that was unchanged, while depositories, which have a larger share of GSE and portfolio loans, saw a decrease,” said Mike Fratantoni, MBA’s Senior Vice President and Chief Economist. “The labor market continued to heal in August, with strong job growth and a large decline in the unemployment rate. However, the economy still faces an uphill climb and remains far away from full employment. High unemployment, and jobless claims consistently around 1 million a week, continue to cause financial strain for some borrowers – and especially for those who work in industries hardest hit by the pandemic.”