MBA: Share of Mortgage Loans in Forbearance Declines to 7.01%

The Mortgage Bankers Association’s latest Forbearance and Call Volume Survey reported loans now in forbearance decreased by 15 basis points last week to 7.01% of mortgage servicers’ portfolio volume as of Sept. 6, down from 7.16% the previous week. According to MBA estimates 3.5 million homeowners are in forbearance plans.

MBA reported the share of Fannie Mae and Freddie Mac loans in forbearance dropped for the 14^th week in a row to 4.65% – a 15-basis-point improvement. Ginnie Mae loans in forbearance decreased 50 basis points to 9.12%, while the forbearance share for portfolio loans and private-label securities increased by 28 basis points to 10.71%. The percentage of loans in forbearance for depository servicers decreased 19 basis points to 7.21%, while the percentage of loans in forbearance for independent mortgage bank servicers decreased 8 basis points to 7.33%.

“The beginning of September brought another drop in the share of loans in forbearance, with declines in both GSE and Ginnie Mae forbearance shares,” said MBA Chief Economist Mike Fratantoni. “However, at least a portion of the decline in the Ginnie Mae share was due to servicers buying delinquent loans out of pools and placing them on their portfolios. As a result of this transfer, the share of portfolio loans in forbearance increased. Forbearance requests increased over the week, particularly for Ginnie Mae loans. With just under 1 million unemployment insurance claims still being filed every week, the lack of additional fiscal support for the unemployed could lead to even higher increases of those needing forbearance.”

Key findings of MBA’s Forbearance and Call Volume Survey – August 31-September 6

• Total loans in forbearance decreased by 15 basis points relative to the prior week: from 7.16% to 7.01%.
  • By investor type, the share of Ginnie Mae loans in forbearance decreased relative to the prior week: from 9.62% to 9.12%.
  • The share of Fannie Mae and Freddie Mac loans in forbearance decreased relative to the prior week: from 4.80% to 4.65%.
  • The share of other loans (e.g., portfolio and PLS loans) in forbearance increased relative to the prior week: from 10.43% to 10.71%.
• By stage, 33.69% of total loans in forbearance are in the initial forbearance plan stage, while 65.35% are in a forbearance extension. The remaining 0.96% are forbearance re-entries.
• Total weekly forbearance requests as a percent of servicing portfolio volume (#) increased relative to the prior week: from 0.09% to 0.11%.
• Weekly servicer call center volume:
  • As a percent of servicing portfolio volume (#), calls increased from 7.2% to 8.7%.
  • Average speed to answer increased from 2.4 minutes to 3.3 minutes. 
  • Abandonment rates increased from 5.1% to 7.3%.
  • Average call length decreased from 7.8 minutes to 7.7 minutes.
• Loans in forbearance as a share of servicing portfolio volume (#) as of September 6:
  • Total: 7.01% (previous week: 7.16%)
  • IMBs: 7.33% (previous week: 7.41%)
  • Depositories: 7.21% (previous week: 7.40%)

MBA’s latest Forbearance and Call Volume Survey represents 74% of the first-mortgage servicing market (37.1 million loans).