Black Knight reports that, as of May 7,
there were 4.1 million loans in forbearance, up from 3.8 million in the company’s
last report which covered plans put into effect by mortgage servicers through
April 30. The new total represents 7.3 percent of all active mortgages and accounts
for $890 billion of unpaid mortgage principal.
Fannie Mae and Freddie Mac guaranteed
loans account for 1.91 million of total loans and $390 billion in principal. Those
loans are 6.4 percent of the 27.9 million loans the GSEs have in service.
There were 1.33 million Ginnie Mae (FHA and
VA) loans in forbearance plans, accounting for an unpaid balance of $246
billion and 11.0 percent of the Ginnie Mae portfolio of 12.1 million loans. The
remaining 933,000 loans are 7.2 percent of the 12.9 million loans being serviced
for portfolio or private label lenders. The unpaid balance is $253 billion.
Even when homeowners are not making their
full mortgage payments, servicers are required to advance principal and interest
(P&I) payments to the investors in securities backed by those loans as well
as making property tax and homeowners insurance premium payments for loans with
escrow accounts. Black Knight estimates that the current level of forbearance
will require monthly advances of $5
billion for P&I and $1.8 billion for taxes and insurance.
The GSEs have capped the advance payment
requirement for its servicers at four months. At the current level of
forbearance that would still be $8 billion in advances. Tax and insurance
payments are not capped. The Ginnie Mae loan advances are currently estimated
at $1.2 billion monthly for P&I and
$0.5 billion for T&I. Ginnie Mae has not capped these payments but has
arranged for a pass-through facility to ease the burden. Another $2.1 billion
in lost funds will be required for the portfolio-held or private label mortgages.