WASHINGTON, D.C. – RealEstateRama – The Mortgage Bankers Association’s (MBA) latest Forbearance and Call Volume Survey revealed that the total number of loans now in forbearance decreased by 23 basis points from 7.67% of servicers’ portfolio volume in the prior week to 7.44% as of August 2, 2020. According to MBA’s estimate, 3.7 million homeowners are in forbearance plans.
The share of Fannie Mae and Freddie Mac loans in forbearance dropped for the ninth week in a row to 5.19% – a 22-basis-point improvement. Ginnie Mae loans in forbearance decreased by 22 basis points to 10.06%, and the forbearance share for portfolio loans and private-label securities (PLS) decreased by 25 basis points to 10.12%. Independent mortgage bank servicers – at 7.71% – surpassed depository servicers (7.63%) for the highest share of loans in forbearance.
“The share of loans in forbearance declined at a more rapid pace last week, with many borrowers who had been making payments while in forbearance deciding to exit. New forbearance requests increased, but are still well below the level of exits,” said Mike Fratantoni, MBA’s Senior Vice President and Chief Economist. “Some of the decline in the share of Ginnie Mae loans in forbearance was due to additional buyouts of delinquent loans from Ginnie Mae pools, which result in these FHA and VA loans being reported in the portfolio category.”
Added Fratantoni, “The job market data in July came in better than expected. However, the unemployment rate is still quite high, and the elevated level of layoffs and slowing pace of hiring will make it more difficult for borrowers to get back on track – particularly if there is not an extension of relief.”
Key findings of MBA’s Forbearance and Call Volume Survey – July 27 to August 2, 2020
- Total loans in forbearance decreased by 23 basis points relative to the prior week: from 7.67% to 7.44%.
- By investor type, the share of Ginnie Mae loans in forbearance decreased: from 10.28% to 10.06%.
- The share of Fannie Mae and Freddie Mac loans in forbearance decreased relative to the prior week: from 5.41% to 5.19%.
- The share of other loans (e.g., portfolio and PLS loans) in forbearance decreased relative to the prior week: from 10.37% to 10.12%.
- By stage, 40.87% of total loans in forbearance are in the initial forbearance plan stage, while 58.43% are in a forbearance extension. The remaining 0.70% are forbearance re-entries.
- Total weekly forbearance requests as a percent of servicing portfolio volume (#) increased relative to the prior week from 0.10% to 0.12%.
- Weekly servicer call center volume:
- As a percent of servicing portfolio volume (#), calls increased from 6.7% to 7.8%.
- Average speed to answer increased from 2.4 minutes to 2.8 minutes.
- Abandonment rates increased from 5.0% to 5.6%.
- Average call length increased from 7.3 minutes to 7.6 minutes.
- Loans in forbearance as a share of servicing portfolio volume (#) as of August 2, 2020:
- Total: 7.44% (previous week: 7.67%)
- IMBs: 7.71% (previous week: 7.81%)
- Depositories: 7.63% (previous week: 7.95%)
MBA’s latest Forbearance and Call Volume Survey covers the period from July 26 through August 2, 2020, and represents 75% of the first-mortgage servicing market (37.3 million loans).