Residential Real Estate News
590,000 U.S. Homeowners Still in Mortgage Forbearance Plans
Based on the Mortgage Bankers Association's latest monthly Loan Monitoring Survey, the total number of U.S. loans now in forbearance decreased by 12 basis points from 1.30% of servicers' portfolio volume in the prior month to 1.18% as of February 28, 2022. According to MBA's estimate, 590,000 homeowners are in forbearance plans.
The share of Fannie Mae and Freddie Mac loans in forbearance decreased 8 basis points to 0.56%. Ginnie Mae loans in forbearance decreased 10 basis points to 1.50%, and the forbearance share for portfolio loans and private-label securities (PLS) declined 30 basis points to 2.72%.
"There were many positive results in overall mortgage performance in February. The percentage of borrowers in forbearance declined for the 21st consecutive month, and the percentage of borrowers current on their mortgage payments increased to almost 95 percent - 350 basis points higher than one year ago. Finally, the percentage of borrowers with existing loan workouts who were current on their mortgage payments improved for the first time since June 2021," said Marina Walsh, CMB, MBA's Vice President of Industry Analysis. "These three results - the lower forbearance rates and higher performance rates for both total borrowers and borrowers in workouts - are especially favorable given that there is typically a dip in mortgage performance in February because of the shortened number of days to make a payment."
Added Walsh, "We can credit several factors to the improved performance, including the availability of viable loss mitigation options, low unemployment that is now below 4.0 percent, strong wage growth, and rising home equity."
