The total number of loans in forbearance fell 16 basis points from 5.83% of servicers’ portfolio volume in the prior week to 5.67% as of November 01, according to the latest figures from the Mortgage Bankers Association (MBA).
The MBA estimated that 2.8 million homeowners are in forbearance plans.
“With declines in the share of loans in forbearance across the board, the data this week align well with the positive news from October’s jobs report, which showed a gain of more than 900,000 private sector jobs, and a one percentage point decrease in the unemployment rate,” said Mike Fratantoni, senior vice president and chief economist at MBA. “A recovering job market, coupled with a strong housing market, is providing the support needed for many homeowners to get back on their feet.”
However, Fratantoni warned that the data continued to show that servicers “are still having difficulties reaching borrowers who have reached the six-month point of their forbearance period.”
“Servicers are required to get borrowers’ consent to extend forbearance beyond six months,” said Fratantoni. “Homeowners who continue to be impacted by hardships related to the pandemic should contact their servicer.”
Broken down, numbers from MPA revealed that the share of Fannie Mae and Freddie Mac loans in forbearance dropped for the 22nd week in a row to 3.49% – a 17-basis-point improvement. Ginnie Mae loans in forbearance decreased 18 basis points to 7.95%, and the forbearance share for portfolio loans and private-label securities decreased by 12 basis points to 8.70%.
Meanwhile, the percentage of loans in forbearance for independent mortgage bank servicers decreased 8 basis points to 6.19%, while the percentage of loans in forbearance for depository servicers decreased 26 basis points from the previous week to 5.60%.