At the end of May, the lowest number of mortgages since the pandemic began the forbearance process in a week, according to Black Knight.
After successive weekly increases of 16,000 loans entered into the process, deferred loans decreased by 71,000 to 2.124 million at 1. These defaulting borrowers account for 4% of the 53 million active mortgages in the market, and add up to an unpaid principal of $ 417 billion, down from $ 431 billion weekly.
"The limited number of moratorium plans this week was due to both broad general economic improvement in general and mortgage performance improvements in particular, but also the shortened vacation week that resulted in one day less for the plans to initiate," Andy said Walden, Black Knight's director of market research, told NMN.
Roughly 65,000 plans due to expire in May are left out, which could lead to another sharp drop next week. Additionally, 700,000 plans will expire by the end of June when they reach the end of their 18-month grace period.
By loan type, Fannie Mae and Freddie Mac-backed loans declined by 26,000 week over week, falling to a total of 656,000. Government-sponsored mortgages – sponsored by the FHA and VA – led the overall decline, falling from 28,000 to a total of 859,000. Securitized portfolio and private label loans – which do not fall under the protection of the CARES Act – fell by 17,000 to a total of 609,000.
According to Black Knights analysis, service providers have to pay monthly advances of approximately $ 2.6 billion in principal and interest payments and $ 900 million in taxes and insurance per month. These break down into estimates of $ 700 million and $ 300 million for government-sponsored corporate loans, $ 800 million and $ 300 million for government-sponsored loans, and $ 1 billion and $ 300 million for Own brands.