The latest report from the Mortgage Bankers Association found that forbearance requests from borrowers flattened considerably in the past week.
A total of 8.16 percent of servicers’ portfolios were in forbearance as of May 10, the association reported, up just slightly from 7.91 percent the week before.
This equates to about 100,000 new requests over the past week from nearly 4 million. The total rose nearly 200,000 the week before after rising 500,000 and 1.1 million the previous two weeks.
“The pace of forbearance requests continued to slow in the second week of May, but the share of loans in forbearance increased,” MBA Senior Vice President and Chief Economist Mike Fratantoni said. “There has been a pronounced flattening in loans put into forbearance – despite April’s uniformly negative economic data, remarkably high unemployment, and it now being past May payment due dates.”
According to Fratantoni, record-low mortgages rates are sustaining the refinance wave, helping homeowners lower their mortgage payments and save money during these challenging times.
Ginnie Mae continues to have the largest share of loans in forbearance at 11.26 percent, followed by Fannie Mae and Freddie Mac at 6.25 percent. But those totals barely budged in the past week, with Ginnie up from 10.96 percent the previous week, while Fannie and Freddie rose from 6.08 percent.
Banks saw their share of loans in forbearance rise to 8.99 percent, while independent mortgage banks rose to 7.85 percent.
“FHA and VA borrowers are more likely to be employed in the sectors hardest hit in this crisis, which is why more than 11 percent of Ginnie Mae loans are currently in forbearance,” Fratantoni said. “We will continue to closely monitor the forbearance request and call volume data for any sign of an uptick, but current trends suggest that if the economy continues to gradually reopen, the situation could be stabilizing.”