Loans in Forbearance Fall Below 3%

Loans in forbearance fell under 3% for the first time since the pandemic started, according to the Mortgage Bankers Association weekly survey…(MBA)

• The total number of loans now in forbearance decreased by 4 basis points to 2.96% as of September 19, 2021.

• Currently, 1.5 million homeowners are in forbearance plans according to estimates from the Mortgage Bankers Association.

NOTE: By stage, 12.0% of total loans in forbearance are in the initial forbearance plan stage, while 79.3% are in a forbearance extension. The remaining 8.7% are forbearance re-entries.

Mike Fratantoni, MBA’s Senior Vice President and Chief Economist, said in a statement, “The share of loans in forbearance continued to decrease last week, dropping below 3 percent for the first time since March 2020.”

• While this is great news, Fratantoni did also note that “New forbearance requests and re-entries continue to run at a higher rate for Ginnie Mae loans as well as for portfolio and PLS loans, which include many delinquent FHA, VA, and USDA loans that have been bought out of Ginnie Mae pools.”