The share of US mortgages in forbearance dropped for the seventh straight week, with 3.8 million homeowners still pausing their mortgage payments during the coronavirus pandemic, the Mortgage Bankers Association announced Monday.
The share of loans in forbearance dropped from 7.74 percent to 7.67 percent as of July 26.
“The share of loans in forbearance declined, but we are now seeing a notable pattern developing over the past two weeks. The forbearance share is decreasing for GSE loans but has slightly increased for Ginnie Mae loans,” said Mike Fratantoni, MBA’s Senior Vice President and Chief Economist. “The job market has cooled somewhat over the past few weeks, with layoffs increasing and other indications that the economic rebound may be losing some steam because of the rising COVID-19 cases throughout the country.”
The share of Fannie Mae and Freddie Mac loans in forbearance dropped for the eighth week in a row to 5.41% – an 8-basis-point improvement. Ginnie Mae loans in forbearance increased by 1 basis point to 10.28%, and the forbearance share for portfolio loans and private-label securities (PLS) decreased by 16 basis points to 10.37%. The percentage of loans in forbearance for depository servicers dropped to 7.95%, while the percentage of loans in forbearance for independent mortgage bank (IMB) servicers decreased to 7.81%.
The survey found:
- The share of Ginnie Mae in forbearance increased from 10.27 percent to 10.28 percent.
- The share of Fannie and Freddie loans in forbearance decreased from 5.49 percent to 5.41 percent.
- The share of independent mortgage bank mortgages decreased from 7.85 percent to 7.81 percent.
- Bank-managed mortgages in forbearance dropped from 8.06 percent to 7.95 percent.
Added Fratantoni, “The higher level of Ginnie Mae loans in forbearance will increase the amount of payments that servicers must advance. We continue to monitor servicer liquidity during these challenging times.”