MBA: Share of Mortgage Loans in Forbearance Inches Up
For the first time in five weeks, loans in forbearance increased, albeit ever so slightly, the Mortgage Bankers Association reported yesterday.
The latest MBA Forbearance and Call Volume Survey reported loans now in forbearance increased by 1 basis point to 5.23% of servicers’ portfolio volume as of February 21 from 5.23% the prior week. MBA estimates 2.6 million homeowners remain in forbearance plans.
The share of Fannie Mae and Freddie Mac loans in forbearance remained flat at 2.97%. Ginnie Mae loans in forbearance increased by 3 basis points to 7.35%, while the forbearance share for portfolio loans and private-label securities increased by 9 basis points to 9.03%. Loans in forbearance for independent mortgage bank servicers increased by 3 basis points to 5.57%, while loans in forbearance for depository servicers increased by 1 basis point to 5.29%.
“A small increase in new forbearance requests, coupled with exits decreasing to match a survey low, led to the overall share of loans in forbearance increasing for the first time in five weeks,” said Mike Fratantoni, MBA Senior Vice President and Chief Economist. “The largest rise in the forbearance share was for portfolio and PLS loans, due to increases for both Ginnie Mae buyouts and other portfolio/PLS loans.”
Fratantoni noted the winter storm that impacted Texas and other states did lead to some temporary
disruptions at servicer call centers, “but these centers quickly returned to full operations.”
Key findings of the MBA Forbearance and Call Volume Survey – February 15 – 21
• Total loans in forbearance increased by 1 basis point relative to the prior week: from 5.22% to 5.23%.
o By investor type, the share of Ginnie Mae loans in forbearance increased relative to the prior week: from 7.32% to 7.35%.
o The share of Fannie Mae and Freddie Mac loans in forbearance remained the same relative to the prior week at 2.97%.
o The share of other loans (e.g., portfolio and PLS loans) in forbearance increased relative to the prior week: from 8.94% to 9.03%.
• By stage, 15.6% of total loans in forbearance are in the initial forbearance plan stage, while 81.9% are in a forbearance extension. The remaining 2.5% are forbearance re-entries.
• Total weekly forbearance requests as a percent of servicing portfolio volume (#) increased relative to the prior week: from 0.06% to 0.07%.
• Of the cumulative forbearance exits for the period from June 1, 2020, through February 21:
o 27.8% represented borrowers who continued to make their monthly payments during their forbearance period.
o 25.9% resulted in a loan deferral/partial claim.
o 15.3% resulted in reinstatements, in which past-due amounts are paid back when exiting forbearance.
o 13.8% represented borrowers who did not make all of their monthly payments and exited forbearance without a loss mitigation plan in place yet.
o 7.8% 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 decreased from the previous week from 9.3% to 7.9%.
o Average speed to answer increased from 2.3 minutes to 3.0 minutes.
o Abandonment rates increased from 6.0% to 7.6%.
o Average call length increased from 8.0 minutes to 8.2 minutes.
• Loans in forbearance as a share of servicing portfolio volume (#) as of February 21:
o Total: 5.23% (previous week: 5.22%)
o IMBs: 5.57% (previous week: 5.54%)
o Depositories: 5.29% (previous week: 5.28%)
MBA’s latest Forbearance and Call Volume Survey represents 74% of the first-mortgage servicing market (37.1 million loans). To subscribe to the full report, go to www.mba.org/fbsurvey.
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