The percentage of Fannie Mae and Freddie Mac loans in forbearance decreased for the first time since the start of the COVID-19 pandemic, according to the weekly forbearance survey released Monday by the Mortgage Bankers Association.
The percentage of Fannie and Freddie mortgages in forbearance decreased from 6.4 percent to 6.38 percent. The share of all mortgages in the United States in forbearance increased slightly from 8.53 percent to 8.55 percent – or 4.3 million loans – as of June 7, the MBA said.
“MBA’s survey results from the first week of June showed a slight uptick in the overall share of loans in forbearance, but this increase was primarily driven by a larger share of portfolio and PLS loans in forbearance. Half of the servicers in our sample saw the forbearance share decline for at least one investor category,” said Mike Fratantoni, MBA’s Senior Vice President and Chief Economist.
The CARES Act includes a moratorium on foreclosures and the right to forbearance on federally backed mortgages. Forbearance allows borrowers to put off payments for at least 180 days if they suffer economic hardship during the pandemic.
MBA’s survey found:
- Ginnie Mae loans in forbearance held steady at a share of 11.83 percent.
- The forbearance share for portfolio loans and private-label securities increased to 10.18 percent.
- The percentage of loans in forbearance for depository servicers rose to 9.24 percent.
- The percentage of loans in forbearance for independent mortgage servicers increased to 8.43 percent.
“Although there continues to be layoffs, the job market does appear to be improving, and this is likely leading to many borrowers in forbearance deciding to opt out of their plan,” Fratantoni said.