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Monday, April 17, 2023

MBA Survey: "Share of Mortgage Loans in Forbearance Decreases to 0.55% in March"

by Calculated Risk on 4/17/2023 04:00:00 PM

From the MBA: Share of Mortgage Loans in Forbearance Decreases to 0.55% in March

The Mortgage Bankers Association’s (MBA) monthly Loan Monitoring Survey revealed that the total number of loans now in forbearance decreased by 5 basis points from 0.60% of servicers’ portfolio volume in the prior month to 0.55% as of March 31, 2023. According to MBA’s estimate, 275,000 homeowners are in forbearance plans. Mortgage servicers have provided forbearance to approximately 7.8 million borrowers since March 2020.

In March 2023, the share of Fannie Mae and Freddie Mac loans in forbearance decreased 2 basis points to 0.26%. Ginnie Mae loans in forbearance decreased 10 basis points to 1.18%, and the forbearance share for portfolio loans and private-label securities (PLS) decreased 10 basis points to 0.68%.

“As the COVID-19 national emergency draws to a close, the number of loans in forbearance continues to drop,” said Marina Walsh, CMB, MBA’s Vice President of Industry Analysis. “Mortgage performance remains strong with the percentage of borrowers who were current on their mortgage payments and post-forbearance workouts increasing in March.”

Adds Walsh, “MBA’s forecast still calls for a recession in 2023, which may change the current performance levels, but credit quality is generally good and many borrowers facing financial hardship can now access enhanced loss mitigation options that resulted from successes of pandemic-related policies.”
emphasis added
MBA Forbearance Survey Click on graph for larger image.

This graph shows the percent of portfolio in forbearance by investor type over time.

The share of forbearance plans has been decreasing, declined to 0.55% in March from 0.60% in February.

At the end of March, there were about 275,000 homeowners in forbearance plans.