The share of mortgages in forbearance plans as of May 3 had grown to 7.91% – or nearly 4 million loans – according to the Mortgage Bankers Association (MBA).
It’s a staggering statistic: As of March 2, just two months earlier, only 0.25% of all loans were in forbearance.
Although the percentage of loans of forbearance has reached near-record highs, in recent weeks the rate of requests for forbearance has slowed, the MBA’s data show.
Mortgages backed by Ginnie Mae had the largest overall share of loans in forbearance by investor type, at 10.96%.
The number of loans in forbearance for depository servicers increased to 8.75%, while the number of loans in forbearance for independent mortgage bank (IMB) servicers increased to 7.54%.
“With the calendar turning to May, the share of loans in forbearance increased, but the pace of the increase and incoming forbearance requests continued to slow,” said Mike Fratantoni, senior vice president and chief economist for the MBA, in a statement. “The dreadful April jobs report showed a decline of more than 20 million jobs, and a spike in the unemployment rate to the highest level since the Great Depression.
“It will not be surprising if the forbearance numbers continue to rise,” Fratantoni said. “As we anticipated, FHA and VA borrowers have been most impacted by the job losses thus far, with the share of Ginnie Mae loans in forbearance at almost 11 percent.
“Although the pace of forbearance requests slowed this week, call volume picked up – which could be a sign that more borrowers are calling in to check their options now that May due dates have arrived,” he added.