WASHINGTON, D.C. – RealEstateRama – The Mortgage Bankers Association’s (MBA) new monthly Loan Monitoring Survey revealed that the total number of loans now in forbearance decreased by 39 basis points from 2.06% of servicers’ portfolio volume in the prior month to 1.67% as of November 30, 2021. According to MBA’s estimate, 835,000 homeowners are in forbearance plans.
The share of Fannie Mae and Freddie Mac loans in forbearance decreased 16 basis points to 0.76%. Ginnie Mae loans in forbearance decreased 42 basis points to 2.10%, and the forbearance share for portfolio loans and private-label securities (PLS) declined 106 basis points to 3.94%.
“The share of loans in forbearance in November declined – albeit at a slower pace than October – as borrowers continued to near the expiration of their forbearance plans and moved into permanent loan workout solutions,” said Marina Walsh, CMB, MBA’s Vice President of Industry Analysis.
Total loans serviced that were current (not delinquent or in foreclosure) as a percent of servicing portfolio volume (#) rose to 94.58% in November from 94.32% in October (on a non-seasonally adjusted basis). Total completed loan workouts from 2020 and onward (repayment plans, loan deferrals/partial claims, loan modifications) that were current as a percent of total completed workouts declined to 83.69% last month from 84.04% in October.
“More borrowers were current on their mortgage payments in November compared to October. This coincides with continued improvement in the labor market – faster wage growth and the unemployment rate dropping to 4.2 percent,” said Walsh. “While there was some deterioration in the performance of borrowers in post-forbearance workouts, four out of five overall remained current through November.”
Key findings of MBA’s Loan Monitoring Survey – November 1 to November 30, 2021
- Total loans in forbearance decreased by 39 basis points in November relative to October: from 2.06% to 1.67%.
- By investor type, the share of Ginnie Mae loans in forbearance decreased relative to the prior month: from 2.52% to 2.10%.
- The share of Fannie Mae and Freddie Mac loans in forbearance decreased relative to the prior month: from 0.92% to 0.76%.
- The share of other loans (e.g., portfolio and PLS loans) in forbearance decreased relative to the prior month: from 5.00% to 3.94%.
- Loans in forbearance as a share of servicing portfolio volume (#) as of November 30, 2021:
- Total: 1.67% (previous month: 2.06%)
- Independent Mortgage Banks (IMBs): 1.94% (previous month: 2.28%)
- Depositories: 1.52% (previous month: 2.02%)
- By stage, 18.3% of total loans in forbearance are in the initial forbearance plan stage, while 68.4% are in a forbearance extension. The remaining 13.3% are forbearance re-entries, including re-entries with extensions.
- Of the cumulative forbearance exits for the period from June 1, 2020, through November 30, 2021, at the time of forbearance exit:
- 29.1% resulted in a loan deferral/partial claim.
- 19.9% represented borrowers who continued to make their monthly payments during their forbearance period.
- 16.8% represented borrowers who did not make all of their monthly payments and exited forbearance without a loss mitigation plan in place yet.
- 14.1% resulted in a loan modification or trial loan modification.
- 11.8% resulted in reinstatements, in which past-due amounts are paid back when exiting forbearance.
- 6.9% 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.
- The five states with the highest share of loans that were current as a percent of servicing portfolio: Idaho, Washington, Utah, Colorado, and Oregon.
- The five states with the lowest share of loans that were current as a percent of servicing portfolio: Louisiana, Mississippi, New York, West Virginia, and Oklahoma.
MBA’s new monthly Loan Monitoring Survey (replaces MBA’s Weekly Forbearance and Call Volume Survey) covers the period from November 1 through November 30, 2021, and represents 73% of the first-mortgage servicing market (36.5 million loans). To subscribe to the full report, go to www.mba.org/loanmonitoring.
NOTE: The next publication of the Monthly Loan Monitoring Survey (LMS) will be Tuesday, January 18, 2022, at 4:00 p.m. ET. For more detailed information on performance metrics, including seasonally adjusted delinquency rates by stage (30 days, 60 days, 90+ days), please refer to MBA’s Quarterly National Delinquency Survey at www.mba.org/nds