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Forbearances Edge Lower

Forbearances Edge Lower

Forbearance plan volumes edged lower this week as the slow but steady unwinding of COVID-related mortgage assistance continued on a gradually flattening slope.

According to our McDash Flash daily mortgage performance dataset, the number of active forbearance plans decreased 29,000 (-4%) this week, led by a 22,000 (-8%) drop in plans for loans held in bank portfolios and private-label securities (PLS). GSE and FHA/VA plans declined by 6,000 (-2%), and 1,000 (-0.4%) respectively.

New plan starts held steady, while re-start activity ticked higher.

As of February 8th, 761,000 homeowners remain in COVID-19-related forbearance plans – 1.4% of all active mortgages. The group includes 0.9% of GSE mortgages, 2.3% of FHA/VA and 1.9% of portfolio held and privately securitized mortgages.

Plans are down by 18,000 (-2%) from the same time last month, as the overall rate of improvement continues to slow with lower expiration activity.

The next significant opportunity for improvement will come in early March. More than 150,000 plans are up for review over the next couple of weeks, with a third expected to reach their final expirations.

We will continue to monitor the very latest forbearance data from the McDash Flash dataset and report our findings each week on this blog.