Black Knight: Forbearances Improved At Fastest Rate Since Pandemic Began

The number of loans in active forbearance have fallen another 10% since last Tuesday, adding to last week’s 11% drop, according to Black Knight’s blog, Vision. More than 450,000 homeowners have exited forbearance plans just in the last two weeks. Forbearances have fallen 22% over the last month, the fastest decline since the beginning of the pandemic. All investor classes have seen forbearances drop at least 20%. The total number of mortgages in forbearances is down 143,000 this week. The largest drop was in loans held by PSLs and bank portfolios, which fell by 88,000, or 19%. GSEs and FHA/VA loans in forbearance both dropped by 6%. Black Knight noted that this wave of exits was expected, as many plans…

Mortgage Rates Hit Six-Month High, Freddie Cites ‘Inflationary Pressure.’

Mortgage rates rose to their highest point since April, hitting 3.05% over the past week, Freddie Mac reported Thursday. Freddie’s Primary Mortgage Market Survey (PMMS) found that the 30-year fixed-rate mortgage (FRM) averaged 3.05%, up from last week’s 2.99%. A year ago at this time, the 30-year FRM averaged 2.81% “As inflationary pressure builds due to the ongoing pandemic and tightening monetary policy, we expect rates to continue a modest upswing,” said Sam Khater, Freddie Mac’s Chief Economist. “Historically speaking, rates are still low, but many potential homebuyers are staying on the sidelines due to high home price growth. Rising mortgage rates combined with growing home prices make affordability more challenging for potential homebuyers.” Mortgage applications have trended down with increasing interest rates…

Serious Delinquencies Lowest Since May 2020

Only 4.2% of all mortgages were in some stage of delinquency in July 2021, according to CoreLogic’s monthly Loan Performance Insights Report. This is a 2.3% drop from July 2020, when it was 6.5%, but higher than the pre-pandemic rate of 3.6%. The rate of early-stage delinquencies, ranging 20 to 59 days past due, dropped 0.4% year-over-year to 1.1%. Adverse delinquencies, 60 to 89 days past due, fell from 1% to 0.3% year-over-year. Delinquencies 90 or more days past due, or serious delinquencies, fell from 4.1% to 2.8%. It is the lowest serious delinquency rate since May 2020. The share of mortgages that transitioned from current to 30 days past due dropped from 0.8% to 0.6% year-over-year. The foreclosure inventory…

MBA: Refi’s Down 16% YOY

Mortgage loan application volume ticked up 0.2% last week, the Mortgage Bankers Association’s (MBA) weekly survey reported. The Market Composite Index, which measures application volume, rose 0.2% on an adjusted basis. On an unadjusted basis, they rose 0.4% from the week before. The Refinance Index fell 1% and was 16% lower than a year ago. The seasonally adjusted Purchase Index rose 2%, while the unadjusted Purchase Index rose 2% compared to the week before, down 10% from the previous year. “Mortgage rates reached their highest level since June 2021, but application activity changed little this week. An increase in home purchase applications offset a slight decline in refinances,” said Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting. “The increase…

Credit Availability Up In Response To High Equity

Mortgage credit availability rose by 1.5%, according to the Mortgage Bankers Association’s (MBA) Mortgage Credit Availability Index (MCAI). This is its highest level since May 2021. The index analyzes data from Ellie Mae’s AllRegs Market Clarity business information tool. The MCAI rose to 125.6, with the Conventional MCAI increasing 4.5% while the Government MCAI fell by 0.7%. The Jumbo MCAI rose by 5.8% and the Confirming MCAI rose by 2.6%. “Last month’s expansion was driven by a 4.5 percent increase in the conventional index, while the government index slightly decreased. Even with increases in seven out of nine months thus far in 2021, total credit availability is still around 30 percent less than it was in February 2020 before the…

NAR: Housing Affordability Improved In August

Housing affordability improved in August for the second straight month, according to the National Association of Realtors (NAR) housing affordability index report. Month-over-month, mortgage payments fell by only 1.1%, while median family income fell by 0.7%. The index hit a low of 146.5 in June but rose to 151.3 in August. But affordability declined year-over-year (YOY), with monthly mortgage payments rising 13.9% to $1,210 from August 2020. Median family income rose only 3.9%. The effective 30-year fixed mortgage rate was 2.89% in August compared to 3% a year ago. The median existing-home sales price rose 15.6% YOY. Home prices are in a seasonal cool-down, which could account for the numbers. But consumer sentiment on home buying continues to trend downward,…

MBA: Forbearances Drop At Fastest Rate Since October 2020

Forbearances plummetted to 2.62% of servicers’ portfolio volume last week, down from 2.89% the week before, according to the Mortgage Bankers Association’s (MBA) latest survey. The estimated number of homeowners in forbearance plans is around 1.3 million. The decline is part of a trend that’s continued even as government-funded forbearance relief plans have expired. For Fannie Mae and Freddie Mac loans, forbearances were down seventeen basis points to 1.21%. Ginnie Mae loans fell forty-one basis points to 2.94%. Portfolio loans and private-label securities shares fell thirty-five basis points, from 6.77% to 6.91%. Independent mortgage bank servicers saw a drop of thirty-seven basis points to 2.82%, and the share for depository servicers declined twenty-four points to 2.69%. “Many borrowers reached the expiration…

HouseCanary Report: ‘Bleak Picture For Housing Affordability’

National brokerage HouseCanary’s new Market Pulse report shows troubling trends in housing affordability. The report underscored the shortage of homes with selling prices under $200 thousand. While net new listing activity is up in other pricing categories, it’s down 30% for these homes from the same time last year.  List-to-sale price ratios show a seller-friendly environment staying put, hovering slightly above 100. “The record growth in home prices over the past year driven by short supply has made homeownership less affordable for many Americans, especially for would-be first-time homebuyers and those searching for homes under $200K. It’s also worth noting that mortgage rates have increased recently, topping 3% for the first time since early July,” said Jeremy Sicklick, Co-Founder and…

Report: Biggest Weekly Drop In Forbearances In 12 Months

The number of loans in active forbearance fell by 11% since last Tuesday, the largest weekly decline in twelve months, according to Black Knight’s blog, Vision. That leaves 1.39 million homeowners in forbearances due to Covid-19.  The total number of mortgages in forbearances is down 177,000 this week. The largest drop was in FHA/VA loans, which fell by 84,000 plans. GSE loans in forbearance dropped by 11% and bank portfolios/PLS dropped by 8%. Black Knight has been expecting a huge decline in forbearance plans, and predicted last week that this week would be a killer, saying “the largest declines in forbearance volumes typically come during the first week of the month, as plans which expired in the prior month are…

High Home Prices Driving HPSI Down

Fannie Mae’s Home Purchase Sentiment Index (HPSI) fell 1.2 points to 74.5 in September. Three of the index’s six components dropped month-over-month. The full index is down 6.5 points year-over-year. More consumers, 66%, reported that it’s a bad time to buy a home in September than in August, when 63% of respondents said the same. Only 28% said they believe it’s a good time to buy. The home-selling conditions component stayed flat, as a majority of consumers reported they believe it’s a good time to sell. “The HPSI declined slightly this month but remains within the general bounds we’ve seen since the end of last year,” said Doug Duncan, Fannie Mae Senior Vice President and Chief Economist.  “The survey’s story…