Any decline in the number of mortgages in forbearance
appears to have, at least temporarily, reached a plateau.
For the second
straight week Black Knight’s survey found little change; only 1,000 fewer
mortgages were in plans during the week ended August 25 than during the
previous period. The company estimates that 3.9 million homeowners continue to
use the COVID-19 relief authorized by the CARES Act and slightly less than
three-quarters are now in an extension of their original 90-day plans. The forbearance
total represents $828 billion in unpaid principal and 7.4 percent of all
mortgages being serviced, the same percentage as the previous week.

There are
now about 5.3 percent of all GSE-backed loans in forbearance, numbering 1.474
million. The FHA/VA total is 1.409 million or 11.6 percent and 1.048 million or
8.1 percent of “other” loans, i.e. portfolio loans and those in private label
securities (PLS) are in forbearance.

The number
of GSE loans in forbearance has been declining, but those improvements have
been offset by increases in FHA/VA and Portfolio/PLS portfolios.  GSE plans declined by 23,000 during the week
while FHA plans increased by 10,000 and other loans by 12,000.  

While recent
declines have been minimal, there has been improvement.
The number of total plans
is down 171,000 over the last 30 days, a 4.0 percent decline. GSE loans have
posted the largest decrease, 128,000 or -8 percent. More modest improvements
have been seen among FHA/VA and “other” loans, down 23,000 and 20,000 plans,
respectively. Each represents a -2 percent change.   

Black Knight
estimates that the monthly advances for principal and interest on loans in
forbearance is $1.6 billion for GSE loans, $1.3 billion for FHA/VA loans, and
$1.8 billion for other loans. Tax and insurance payments total $1.8 billion a
month, spread nearly equally across loan types.

By Jann Swanson , dated 2020-08-31 08:20:40

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Courtesy of Mortgage News Daily

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