Find out how the various servicers fared
Loans in forbearance have increased by one basis point to 0.70% of lenders’ portfolio volume in what is the first monthly increase in 29 months, new numbers reveal. By the Mortgage Bankers Association’s estimate, this means roughly 350,000 homeowners are now in forbearance plans.
The Mortgage Bankers Association (MBA) has released its monthly loan monitoring survey, which surveys servicers on all loans in forbearance regardless of the borrower’s stated reason. The share has increased from 0.69% in September to 0.70% as of October 31.
Fannie Mae and Freddie Mac loans in forbearance also increased by one basis point to 0.31%, while Ginnie Mae loans in forbearance jumped eight basis points to 1.41%.
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MBA’s vice president of industry analysis Marina Walsh said that while the overall proportion of loans in forbearance rose slightly in October, it was “a mixed bag” in terms of investor type.
“The forbearance rate for Ginnie Mae, Fannie Mae, and Freddie Mac loans increased, and there was a decline in portfolio and PLS loans in forbearance [from 1.14% to 1.03%],” she said. “Several factors were behind the first monthly increase in forbearances in 29 months, including the effects of Hurricane Ian in the Southeast, the diminishing number of loans bought out of Ginnie Mae pools and placed in portfolio, and the fact that new forbearance requests have closely matched forbearance exits for the past three months.”
The total share of loans that were current decreased by 15 basis points to 95.7% on a month-on-month basis. Forty-four (44) states reported declines that were not delinquent or in foreclosure. Unsurprisingly, Florida – the hardest-hit by Hurricane Ian – experienced the biggest drop in the share of loans that were current.
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The states with the highest share of loans that were current relative to the servicing portfolio were Washington, Idaho, Colorado, Utah, and Oregon, while the states with the lowest share were Mississippi, Louisiana, New York, West Virginia, and Indiana.
By stage, 36.7% of all loans in forbearance were in the initial stage of their forbearance plans, while 50.9% were already in a forbearance extension. Forbearance re-entries and re-entry extensions made up the remaining 12.4%.
MBA’s loan monitoring survey also studied cumulative forbearance exits from June 1 through October 31 this year. At the time of forbearance exit, almost 30% resulted in a loan deferral or partial claim, 16% resulted in a loan modification, and 11% resulted in reinstatements, with past-due amounts paid back when existing. Roughly 7% resulted in loans paid off by selling the home or through a refinance.
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MBA’s loan monitoring survey represents two-thirds of the first-mortgage servicing market – or 32.9 million loans.