Forbearance exits jump to a high not seen since March

Forbearance exits jumped to a high not seen since March, outweighing a slight increase in new requests and re-entries, according to the Mortgage Bankers Association’s latest weekly report.

As a percentage of servicers’ portfolio volume, exits increased by 15 basis points to 3.08%, new requests rose to 0.05% from 0.04% and call center activity jumped to 7.7% from 5.58% from the previous week.

The numbers for the period between Aug. 30 and Sept. 5 point to a trend in which pandemic-related payment suspensions are staging increasingly steep drops on a net basis as expiration dates approach even though the number of new borrowers requesting forbearance plans is inching up.

“We anticipate a similarly fast pace of exits in the weeks ahead, which should lead to increased call volume and a further decline in the forbearance share,” said Mike Fratantoni, chief economist at the Mortgage Bankers Association, in a press release.

Even with the net decline in forbearance, other statistics point to capacity strains in call centers due to new requests. Average speed to answer rose to 1.6 minutes from a minute, abandonment rates jumped to 4% from 3.3%, and handle times increased to 8.2 minutes from 8.1 minutes.

Forbearance rates remained slightly higher at non-depositories at 3.33%, down from 3.49%, compared to banks in the MBA’s survey, which recorded a drop to 3.15% from 3.33%.

The forbearance rate for loans in Ginnie Mae securitizations fell to 3.39% from 3.63% and it dropped to 1.52% from 1.63% for Fannie Mae and Freddie Mac loans. Other loans, a category that includes privately securitized and portfolio products, recorded a decline to 7.27% from 7.52%.

The MBA’s data reflects reports from 24 independent mortgage companies, 21 depositories and two subservicers.