MBA: Share of Mortgage Loans in Forbearance Dips Slightly to 5.90%

The Mortgage Bankers Association’s latest Forbearance and Call Volume Survey reported loans now in forbearance decreased by 2 basis points to 5.90% of servicers’ portfolio volume as of Oct. 18, from 5.92% the prior week. MBA estimates 3 million homeowners are in forbearance plans.

The share of Fannie Mae and Freddie Mac loans in forbearance dropped for the 20^th week in a row to 3.72% – a 5-basis-point improvement. Ginnie Mae loans in forbearance increased 3 basis points to 8.17%, and the forbearance share for portfolio loans and private-label securities increased by 4 basis points to 8.90%. The percentage of loans in forbearance for independent mortgage bank servicers increased 2 basis points to 6.35%, while the percentage of loans in forbearance for depository servicers decreased 7 basis points to 5.86%.

“The share of loans in forbearance declined only slightly in the prior week, after two weeks of a flurry of borrowers exiting as they reached the six-month mark,” said Mike Fratantoni, MBA Senior Vice President and Chief Economist. “There continues to be a steady improvement for Fannie Mae and Freddie Mac loans, but the forbearance share for Ginnie Mae, portfolio, and PLS loans all increased. This is further evidence of the unevenness in the current economic recovery. The housing market is booming, as shown by the extremely strong pace of home sales last week. However, many homeowners continue to struggle, as the pace of the job market’s improvement has waned.”

Key findings of MBA’s Forbearance and Call Volume Survey – October 12-18:

• Total loans in forbearance decreased by 2 basis points relative to the prior week: from 5.92% to 5.90%.
  • By investor type, the share of Ginnie Mae loans in forbearance increased relative to the prior week: from 8.14% to 8.17%.
  • The share of Fannie Mae and Freddie Mac loans in forbearance decreased relative to the prior week: from 3.77% to 3.72%.
  • The share of other loans (e.g., portfolio and PLS loans) in forbearance increased relative to the prior week: from 8.86% to 8.90%.
• By stage, 25.02% of total loans in forbearance are in the initial forbearance plan stage, while 73.14% are in a forbearance extension. The remaining 1.84% are forbearance re-entries.
• Total weekly forbearance requests as a percent of servicing portfolio volume (#) increased relative to the prior week: from 0.10% to 0.11%.
• Weekly servicer call center volume:
  • As a percent of servicing portfolio volume (#), calls increased from 8.2% to 8.9%.
  • Average speed to answer remained unchanged at 3.0 minutes.
  • Abandonment rates decreased from 7.0% to 6.8%.
  • Average call length remained unchanged at 7.6 minutes.
• Loans in forbearance as a share of servicing portfolio volume (#) as of October 18:
  • Total: 5.90% (previous week: 5.92%)
  • IMBs: 6.35% (previous week: 6.33%)
  • Depositories: 5.86% (previous week: 5.93%)

MBA’s latest Forbearance and Call Volume Survey represents 75% of the first-mortgage servicing market (37.3 million loans). To subscribe to the full report, go to www.mba.org/fbsurvey.

If you are a mortgage servicer interested in participating in the survey, email fbsurvey@mba.org.