Over the last 30 days, the number of borrowers with pandemic-related payment suspensions plummeted at a rate not seen since the coronavirus arrived in the United States.
Loans in active forbearance dropped by 359,000 or 22% during that period, according to Black Knight’s latest report. The decline for the 30 days ending Oct. 12 was in line with a large number of plan expiration dates, and occurred despite
Forbearance on mortgages insured by the Federal Housing Administration or guaranteed by the Department of Veterans Affairs fell by 26% or 160,000 dropped during the same time span, compared to 21% or a decline of 101,500 for loans purchased by government-sponsored enterprises Fannie Mae and Freddie Mac, and 20% or a drop of 98,000 for loans held in portfolios or
While the extension of the government loan deadline did not slow the 30-day rate of decline, a shorter-term drop in forbearance recorded in Black Knight’s report was slightly smaller than
Declines occurred in all product types during the seven-day period. Fannie Mae and Freddie Mac and FHA and VA loans, which both now have open-ended dates for initial forbearance plan filings, saw matching consecutive-week declines of 6%.
FHA and VA loans as of Oct. 12 made up nearly 39% of all remaining forbearance in the market, followed by PLS loans at 31% and Fannie Mae and Freddie Mac mortgages at more than 30%.
Roughly 1.25 million mortgages representing 2.4% of U.S. home loans remained in forbearance as of Oct. 12, down from 2.6% as of Oct. 5. The forbearance rates for the three loan types as of Oct. 12 were as follows: FHA and VA, 4%; portfolio and private securitized loans, 3%; and mortgages purchased by the GSEs, 1.3%.
Black Knight expects to see 47,000 exits from September complete processing and another 329,000 plans undergo removal or extension in October.
“Potential for further, substantial declines will continue into early November,” said Andy Walden, vice president of market research at Black Knight, in
Black Knight’s numbers come from its McDash Flash data set, which provides daily loan status and payment information from more than 60 of the largest servicers, reflecting around 70% of the market.