Forbearance share drops for the sixth straight week

The share of mortgage loans in forbearance decreased for the sixth straight week, according to recent figures from the Mortgage Bankers Association (MBA).

MBA data revealed that the total number of loans now in forbearance decreased by 24 basis points to 4.66% as of April 04, 2021, from 4.90% in the prior week.

According to MBA’s estimate, 2.3 million homeowners are in forbearance plans.

Read more: Three solutions for homeowners in forbearance

Mike Fratantoni, senior vice president and chief economist at MBA, said the decline represents “one of the largest decreases in the history of the series.”

“The forbearance share also decreased significantly for all three investor categories, with the rate for Ginnie Mae loans down an impressive 45 basis points,” said Fratantoni. “Overall, forbearance exits increased to their fastest pace since early November. Almost 32% of borrowers in forbearance extensions have now exceeded the 12-month mark. In terms of performance, more than 88% of homeowners who have exited into deferral plans, modifications, or repayment plans were current on their loans at the end of March, compared to 92% of all homeowners.”

Additionally, Fratantoni said that the “accelerating economic recovery in March helped more homeowners recover and become current on their mortgages, in addition to helping other homeowners with more stable financial situations exit forbearance.”

“Homeowners who are still facing hardships and need to extend their forbearance term should contact their servicers,” Fratantoni concluded.