MBA releases the latest data showing how many homeowners are reliant on the plans
The total number of loans in forbearance decreased in January, according to the monthly survey conducted by the Mortgage Bankers Association (MBA).
In the MBA’s Loan Monitoring Survey, it was found that the total number of loans in forbearance decreased by one basis point from the previous month’s findings, taking the 0.23% seen in December to 0.22% by the end of January.
The MBA estimated that there were about 110,000 homeowners in forbearance plans. Since March 2020, mortgage servicers have given forbearance to about 8.1 million borrowers.
About 67.7% of borrowers were in forbearance because of reasons like temporary hardship brought about by job loss, death, divorce, or disability, while 19.8% were because of COVID-19. About 12.5% said that the reason was a natural disaster.
“The combination of a potential economic slowdown in 2024, and indications that consumer debt balances and delinquencies are on the rise, could lead to more homeowners struggling to make their mortgage payments and inquire about forbearance and available loan workout options,” said Marina Walsh, CMB, MBA’s vice president of industry analysis.
“Most pandemic-related protocols have sunset, which gives mortgage servicers different rules of engagement when it comes to assisting borrowers through loan forbearance or a loan workout,” added Walsh.
January 2024 saw the share of Fannie Mae and Freddie Mac loans in forbearance decrease to 0.13%. Meanwhile, Ginnie Mae loans in forbearance were still at 0.39% while the forbearance share for portfolio loans and private-label securities (PLS) saw an increase to 0.28%.
The MBA’s Loan Monitoring Survey covered the period from January 1 until January 31. It represented about 64% of the first-mortgage servicing market, amounting to 32 million loans.
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