After a week of near-stasis, the number of forbearance-related coronavirus mortgages continued to decline. The forbearance rate fell 7 basis points between October 19-25, according to the Mortgage Bankers Association.
Home loans in forbearance plans account for 5.83% – about 2.9 million homeowners – of all outstanding mortgages, down from 5.9% from the previous week. This is the lowest point since the share price for the week ended April 5th at 3.74%.
The proportion of forborne loans held by independent mortgage lenders fell from 6.35% to 6.27%, while the custodians were 5.86%.
"Nearly half of previous forbearance outcomes have been from borrowers who stayed current during the forbearance or were suspended through repayments of overdue amounts," said Mike Fratantoni, senior vice president and chief economist of the MBA, in a press release. “The credit share of forbearance has returned to its early April levels but remains remarkably high. Further improvement requires a sustained recovery in the labor market and additional fiscal incentives. "
Forbearance fell on every type of loan.
The proportion of compliant mortgages purchased by Fannie Mae and Freddie Mac decreased from 3.72% to 3.66% for the 21st straight week. Ginnie Mae's loans – Federal Housing Administration, Department of Veterans Affairs, and US Department of Agriculture – fell from 8.17% to 8.13%. Forgiving private label securities and portfolio loans – products not regulated in the Coronavirus Relief Act – fell from 8.9% to 8.82%.
A 23.95% stake of all forborne mortgages is in the initial forbearance stages, while 74.49% moved to advanced plans and the remaining 1.56% returned to forbearance after the previous exit.
Forbearance requests as a percentage of service portfolio volume continued to flutter, falling from 0.11% to 0.1%. The call center volume as a percentage of the portfolio volume fell from 8.9% to 6.7%.
The MBA sample for this week's survey includes a total of 50 servicers with 26 independent mortgage lenders and 22 custodians. The sample also included two subservicers. In relation to the number of units, the respondents accounted for around 75% or 37.3 million of the outstanding first liens.