Knight says its research is showing that the numbers of new forbearance plans for
homeowners financially affected by the COVID-19 pandemic have slowed to a
trickle compared to the tidal wave in early April. Only 7,000 new plans were
put in place during the week ended May 26 compared to a 325,000-net increase in
the first week of May and 1.4 million in the first week of April.
most recent increase brings the total forbearance plans to 4.76 million or 9.0
percent of all active mortgages. These loans represent more than $1 trillion in
unpaid principal balances.
largest number of loans in forbearance plans, 1.99 million, are those serviced
for the GSEs Fannie Mae and Freddie Mac. Another 1.535 million are serviced for
Ginnie Mae (loans backed by FHA, the VA, and USDA) and 1.233 million are mortgages
belonging to “others” such as bank portfolios or investors in private label securitizations.
However, in terms of the impact on portfolios, 12.6 percent of the Ginnie Mae
portfolio of 12.1 million mortgages are in forbearance, as are 9.5 percent of “other”
loans, and 7.2 percent of the 27.9 million GSE aggregate portfolios.
of contractual obligations, servicers of the government-backed loans must
continue to advance principal and interest (P&I) payments to investors and
taxes and insurance premiums (T&I) on behalf of loans with escrow accounts
even though homeowners are not making their monthly payments. Black Knight
places those obligations, given the current number of forbearance plans, at $3.6
billion a month in P&I payments and $1.5 billion in T&I payments.
Federal Housing Finance Agency, conservator and regulator of the GSEs, has
capped servicer obligations for P&I advance payments on their loans at four
months. Black Knight says, given today’s forbearance numbers, servicers of
GSE-backed loans still face up to $8.8 billion in advances over that four-month