An estimated 3.8 million homeowners are now in forbearance plans, according to a survey by the Mortgage Bankers Association.
According to the MBA’s latest “Forbearance and Call Volume Survey”, the share of mortgages in forbearance has hit 7.54%. Mortgages backed by Ginnie Mae had the largest overall share of loans in forbearance by investor type (10.45%). The number of loans in forbearance for depository servicers rose to 8,41%, and the share for independent mortgage bank servicers rose to 7.13%, the MBA reported.
“The share of loans in forbearance increased once again in the last full week of April, but the pace of new requests slowed,” said Mike Fratantoni, MBA senior vice president and chief economist. “With millions more Americans filing for unemployment over the week, the level of job market distress continues to worsen. That is why we expect that the share of loans in forbearance will continue to grow, particularly as new mortgage payments come due in May.”
Fratantoni said that as states begin to reopen their economies, there are some indications of increased activity in the housing market, including increased purchase applications in some markets.
“We are hopeful that the housing market can eventually contribute to a broader rebound in economic activity, which would then begin to reverse the unprecedented job losses experienced during this crisis,” he said.
Other key findings of the MBA’s report included:
- The share of Fannie Mae and Freddie Mac loans in forbearance increased week over week from 5.46% to 5.85%
- The share of other loans in forbearance, such as private-label securities and portfolio loans, increased from 7.52% to 8.3%
Forbearance requests as a percent of servicing portfolio volume dropped across all investor types for the third straight week, from 1.14% to 0.63%