Loans in forbearance continued to fall for the week ending October 3rd, according to the Mortgage Bankers Association’s weekly data…(MBA)
- Total number of loans in forbearance fell an impressive 27 basis points to 2.62% last week.
- Just 1.3 million homeowners are now in forbearance plans, according to MBA estimates.
NOTE: By stage, 13.3% of total loans in forbearance are in the initial forbearance plan stage, while 77.5% are in a forbearance extension. The remaining 9.2% are forbearance re-entries.
Mike Fratantoni, MBA’s Senior Vice President and Chief Economist, said that loans in forbearance are disappearing at record levels…
- “Many borrowers reached the expiration of their forbearance term as we entered October. The pace of exits climbed to the fastest pace in over a year, and the share of loans in forbearance declined at the fastest rate since last October, dropping by 27 basis points. The decline was the largest for Ginnie Mae and portfolio/PLS loans,”
MORE GOOD NEWS
CoreLogic’s latest loan performance insights report found that in July, 4.2% of mortgages were delinquent by at least 30 days or more including those in foreclosure…(CoreLogic)
- This represents a 2.3-percentage point decrease in the overall delinquency rate compared with July 2020.
NOTE: The serious delinquency rate was 2.8%, down from 4.1% in July 2020. While it does remain elevated, this is the lowest serious delinquency rate since May 2020.
Dr. Frank Nothaft, Chief Economist for CoreLogic, notes the oversized role equity gains will play in helping distressed homeowners…
- “Even if loan modification or income recovery is unable to help delinquent homeowners become and remain current on their payments, the double-digit rise in home prices may help them avoid a distressed sale…”