Share of Mortgage Loans in Forbearance Decreases to 2.06 Percent
WASHINGTON, D.C. (November 8, 2021) - The Mortgage Bankers Association's (MBA) latest Forbearance and Call Volume Survey revealed that the total number of loans now in forbearance decreased by 9 basis points from 2.15% of servicers' portfolio volume in the prior week to 2.06% as of October 31, 2021. According to MBA's estimate, 1 million homeowners are in forbearance plans.
The share of Fannie Mae and Freddie Mac loans in forbearance decreased 5 basis points to 0.92%. Ginnie Mae loans in forbearance decreased 13 basis points to 2.52%, and the forbearance share for portfolio loans and private-label securities (PLS) declined 13 basis points to 5.00%. The percentage of loans in forbearance for independent mortgage bank (IMB) servicers decreased 15 basis points relative to the prior week to 2.28%, and the percentage of loans in forbearance for depository servicers decreased 5 basis points to 2.02%.
"One million homeowners remained in forbearance as we reached the end of October, but the forbearance share continued to decline, with larger declines for portfolio and PLS loans," said Mike Fratantoni, MBA's Senior Vice President and Chief Economist. "More borrowers who exited forbearance the last week of October went into modifications, a sign that they have not yet regained their pre-pandemic level of income."
Added Fratantoni, "The strong job market report from October, with another drop in the unemployment rate and a pickup in wage growth, is a positive sign for homeowners still struggling to get back on their feet."
Key findings of MBA's Forbearance and Call Volume Survey - October 25 to October 31, 2021
- Total loans in forbearance decreased by 6 basis points relative to the prior week: from 2.15% to 2.06%.
- By investor type, the share of Ginnie Mae loans in forbearance decreased relative to the prior week: from 2.65% to 2.52%.
- The share of Fannie Mae and Freddie Mac loans in forbearance decreased relative to the prior week: from 0.97% to 0.92%.
- The share of other loans (e.g., portfolio and PLS loans) in forbearance decreased relative to the prior week: from 5.23% to 5.00%
- By stage, 15.8% of total loans in forbearance are in the initial forbearance plan stage, while 73.9% are in a forbearance extension. The remaining 10.3% are forbearance re-entries, including re-entries with extensions.
- Total weekly forbearance requests as a percent of servicing portfolio volume (#) remained the same relative to the prior week at 0.04%.
- Of the cumulative forbearance exits for the period from June 1, 2020, through October 31, 2021, at the time of forbearance exit:
- 29.1% resulted in a loan deferral/partial claim.
- 20.4% represented borrowers who continued to make their monthly payments during their forbearance period.
- 16.7% represented borrowers who did not make all of their monthly payments and exited forbearance without a loss mitigation plan in place yet.
- 13.4% resulted in a loan modification or trial loan modification.
- 12.0% resulted in reinstatements, in which past-due amounts are paid back when exiting forbearance.
- 7.0% resulted in loans paid off through either a refinance or by selling the home.
- The remaining 1.4% resulted in repayment plans, short sales, deed-in-lieus or other reasons
- Weekly servicer call center volume:
- As a percent of servicing portfolio volume (#), calls decreased relative to the prior week: from 5.9% to 6.5%.
- Average speed to answer decreased from 1.5 minutes to 1.6 minutes.
- Abandonment rates decreased from 4,0% to 4.5%.
- Average call length decreased from 7.8 minutes to 8.1 minutes.
- Loans in forbearance as a share of servicing portfolio volume (#) as of October 31, 2021:
- Total: 2.06% (previous week: 2.15%)
- IMBs: 2.28% (previous week: 2.43%)
- Depositories: 2.02% (previous week: 2.17%)
MBA's latest Forbearance and Call Volume Survey covers the period from October 18 through October 24, 2021, and represents 73% of the first-mortgage servicing market (36.7 million loans). To subscribe to the full report, go to www.mba.org/fbsurvey. If you are a mortgage servicer interested in participating in the survey, email email@example.com.
NOTE: This is MBA's last Weekly Forbearance and Call Volume Survey. MBA will move to a monthly report in December called the Monthly Loan Monitoring Survey. The first publication of the Monthly Loan Monitoring Survey will cover forbearance and performance data for the period November 1, 2021, through November 30, 2021, and will be released on Monday, December 20, 2021, at 4:00 p.m. ET.