Numbers continue to decline as more homeowners reach the end of their term
The total number of loans in forbearance fell 11 basis points from 4.04% of servicers’ portfolio volume the prior week, as of June 13. The Mortgage Bankers Association estimated that two million homeowners are in forbearance plans.
The share of mortgages in forbearance declined for the 16th consecutive week to 3.66% – a four-basis-point drop from last week.
“The share of loans in forbearance declined for the 16th straight week, with declines across almost every loan category,” said Mike Fratantoni, senior vice president and chief economist at the MBA.
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MBA reported that the percentage of Fannie Mae and Freddie Mac loans in forbearance was down four basis points to 2.05%, and Ginnie Mae loans in forbearance dipped seven basis points to 5.15%. The forbearance share for portfolio loans and private-label securities (PLS) plunged 35 basis points to 7.98%. The percentage of loans in forbearance for independent mortgage bank (IMB) servicers fell 16 basis points to 4.05%, and the percentage of loans in forbearance for depository servicers declined three basis points to 4.16%.
Fratantoni noted that new forbearance requests, at four basis points, remained at an extremely low level.
“More than 44% of borrowers who exited this week used a deferral plan, highlighting the importance of this option,” he said. “As more homeowners reach the end of their forbearance term, we should continue to see the share in forbearance decline. The improving job market and strong housing market are providing support for those who do exit.”
