From the MBA: Share of Mortgage Loans in Forbearance Decreases to 0.60% in February
The Mortgage Bankers Association’s (MBA) monthly Loan Monitoring Survey revealed that the total number of loans now in forbearance decreased by 4 basis points from 0.64% of servicers’ portfolio volume in the prior month to 0.60% as of February 28, 2023. According to MBA’s estimate, 300,000 homeowners are in forbearance plans.
The share of Fannie Mae and Freddie Mac loans in forbearance decreased 2 basis points to 0.28%. Ginnie Mae loans in forbearance decreased 9 basis points to 1.28%, and the forbearance share for portfolio loans and private-label securities (PLS) decreased 5 basis points to 0.78%.
“The forbearance rate decreased for both independent mortgage bank and depository servicers across all investor types in February,” said Marina Walsh, CMB, MBA’s Vice President of Industry Analysis. “Even with the fewer days in the month – which often causes a drop in timely monthly payments – overall servicing portfolio performance declined only slightly to 95.8 percent, while performance of post-forbearance workouts stayed essentially flat at 76.0 percent.”
Added Walsh, “The February results on mortgage performance is welcome news, given recent increases in delinquencies for other credit types such as credit cards and auto loans. However, with the possibility of a recession this year, we may see some deterioration in performance – particularly for government loans.”
emphasis addedClick 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 0.60% in February from 0.64% in January.
At the end of February, there were about 300,000 homeowners in forbearance plans.