MBA: Share of Mortgage Loans in Forbearance Decreases to 5.14%
The Mortgage Bankers Association’s latest Forbearance and Call Volume Survey reported loans now in forbearance decreased by 6 basis points to 5.14% of servicers’ portfolio volume as of March 7 from 5.20% the prior week. MBA estimates 2.6 million homeowners are in forbearance plans.
The share of Fannie Mae and Freddie Mac loans in forbearance decreased to 2.88% – a 6-basis-point improvement. Ginnie Mae loans in forbearance decreased 12 basis points to 7.16%, while the forbearance share for portfolio loans and private-label securities remained unchanged at 9.05%. The percentage of loans in forbearance for independent mortgage bank servicers decreased 6 basis points to 5.45%, while the percentage of loans in forbearance for depository
servicers declined 9 basis points to 5.19%.
“One year after the onset of the pandemic, many homeowners are approaching 12 months in their forbearance plan,” said MBA Chief Economist Mike Fratantoni. “That is likely why call volume to servicers picked up in the prior week to the highest level since last April, and forbearance exits increased to their highest level since January. With new forbearance requests unchanged, the share of loans in forbearance decreased again. Homeowners with federally backed loans have access to up to 18 months of forbearance, but they need to contact their servicer to receive this additional relief.”
Fratantoni noted the American Rescue Plan “provides needed support for homeowners who are continuing to struggle during these challenging times, and stimulus payments are being delivered to households now. We anticipate that this support, along with the improving job market, will help many homeowners to get back on their feet.”
Key findings of MBA’s Forbearance and Call Volume Survey – March 1 – 7
• Total loans in forbearance decreased by 6 basis points relative to the prior week: from 5.20% to 5.14%.
o By investor type, the share of Ginnie Mae loans in forbearance decreased relative to the prior week: from 7.28% to 7.16%.
o The share of Fannie Mae and Freddie Mac loans in forbearance decreased relative to the prior week: from 2.94% to 2.88%.
o The share of other loans (e.g., portfolio and PLS loans) in forbearance remained unchanged relative to the prior week at 9.05%.
• By stage, 14.1% of total loans in forbearance are in the initial forbearance plan stage, while 83.3% are in a forbearance extension. The remaining 2.6% are forbearance re-entries.
• Total weekly forbearance requests as a percent of servicing portfolio volume (#) remained the same relative to the prior two weeks at 0.07%.
• Of the cumulative forbearance exits for the period from June 1, 2020, through March 7:
o 27.3% represented borrowers who continued to make their monthly payments during their forbearance period.
o 26.1% resulted in a loan deferral/partial claim.
o 15.0% resulted in reinstatements, in which past-due amounts are paid back when exiting forbearance.
o 14.1% represented borrowers who did not make all of their monthly payments and exited forbearance without a loss mitigation plan in place yet.
o 8.1% resulted in a loan modification or trial loan modification.
o 7.6% resulted in loans paid off through either a refinance or by selling the home.
o The remaining 1.8% resulted in repayment plans, short sales, deed-in-lieus or other reasons.
• Weekly servicer call center volume:
o As a percent of servicing portfolio volume (#), calls increased from the previous week from 8.7% to 10.0% – the highest level since the week ending April 19.
o Average speed to answer increased from 2.6 minutes to 4.1 minutes.
o Abandonment rates increased from 6.1% to 10.1%.
o Average call length increased from 8.1 minutes to 8.5 minutes.
• Loans in forbearance as a share of servicing portfolio volume (#) as of March 7:
o Total: 5.14% (previous week: 5.20%)
o IMBs: 5.45% (previous week: 5.51%)
o Depositories: 5.19% (previous week: 5.28%)
The MBA Forbearance and Call Volume Survey represents 74% of the first-mortgage servicing market (36.8 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.
