TRD Insights: MBA finds 8% of home loans in forbearance

Figure was 7% less than a month ago; calls from borrowers also rise

New York /
May.May 12, 2020 07:30 AM
(Credit: iStock)

(Credit: iStock)

The share of home loans in forbearance grew again last week, according to figures released Monday by the Mortgage Bankers association.

Mortgages in forbearance made up 7.9 percent of servicers’ portfolios for the week. That was up from 7.5 percent the week ending April 26 and 7 percent for the week before that.

The figure was rarely higher than 1 percent before the coronavirus pandemic. The forbearance share for the first week of March, for example, was only 0.25 percent.

Ginnie Mae-backed mortgages had the highest overall forbearance rate by investor type at almost 11 percent. Ginnie Mae guarantees home loans issued to lower-income borrowers by government agencies such as the Federal Housing Administration and Veterans Affairs.

MBA Chief Economist Mike Fratantoni noted that the pace of the increase slowed a little from the previous week.

Fratantoni warned, though, that servicer call volume picked up from last week, which could signal that more borrowers are inquiring about their options as monthly due dates loom. Calls from borrowers jumped to 8.6 percent of servicing portfolio volume from 7.2 percent last week.


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