As the impact of the COVID-19 pandemic on the U.S. mortgage market has grown, Black Knight is now tracking loan-level forbearance data on via our McDash Flash daily data set.
Leveraging Black Knight’s extensive data assets and proprietary analytics, we’ve launched a suite of McDash Flash solutions based on daily loan-level mortgage data, with insights delivered in multiple forms to meet specific client needs and budgets.
Solutions include the daily McDash Flash Forbearance Tracker that lets market participants review general forbearance trends, model short-term outcomes and plan for reserves, as well as the interactive business intelligence of the McDash Flash Forbearance Monitor, where clients can access forbearance-specific information customized for servicer benchmarking.
For more granular and actionable insight, customized aggregate data sets are available via McDash Flash Data Cubes that can be sorted by investor, vintage, geography and other criteria that allow clients to benchmark their performance against the industry and get metrics on short-term vector forecasts presenting expected future performance.
Additionally, the full McDash Flash Loan-Level Daily Performance Data Set is available via Black Knight’s Rapid Analytics Platform (RAP)SM, which, combined with other RAP components, lets users easily survey millions of records to observe the impact of forbearance – on a daily basis – and identify trends down to the county, ZIP and even neighborhood level. Supplementary, public information datasets based can be incorporated to develop new insights that serve any number of use cases.
With dramatic increases in unemployment, delinquencies and defaults can be expected to increase for the foreseeable future, even during forbearance. McDash Flash provides daily visibility into delinquency and default trends. Using McDash Flash will help servicers anticipate surges in delinquencies and prepare operationally for loss mitigation activities.
The latest data from the McDash Flash Forbearance Tracker shows that as of April 23, more than 3.4 million homeowners are in forbearance programs with their lenders. Together, they represent 6.4% of the entire active mortgage universe and $754 billion in unpaid principal.
This population encompasses 5.6% of all GSE-backed loans and 8.9% of FHA/VA loans. Regardless of a borrower’s forbearance status, servicers of loans in government-backed securities must make advance principal and interest (P&I) payments each month for these loans. At today’s level, mortgage servicers would need to advance $2.8 billion to holders of government-backed mortgage securities on COVID-19-related forbearances each month. Another $1.3 billion in lost funds will be faced each month by those with portfolio-held or privately securitized mortgages.
Given FHFA’s recently announced four-month limit on advance obligations, servicers of GSE-backed mortgages could still face more than $7 billion in advances based on the number of forbearance plans through April 23.
Much more detail on the impact of COVID-19 on the mortgage and real estate industries, as well as challenges and solutions relevant to individual market segments, can be found in Black Knight’s special white paper, available to download for free at this link.
Black Knight will continue to provide weekly McDash Flash Forbearance Tracker updates via this blog.