The latest data from the McDash Flash Forbearance Tracker shows that, following on last week’s decline, the number of active forbearance plans fell another 435,000 week-over-week – marking the largest drop yet. This brings the total number of active forbearances to its lowest point since April 28.
As of July 7, 4.14 million homeowners were in active forbearance, representing 7.8% of all active mortgages, down from 8.6% the week prior. Together, they represent just under $900 billion in unpaid principal.
Some 6.0% of all GSE-backed loans and 11.6% of all FHA/VA loans are currently in forbearance plans. Another 8.2% of loans in private label securities or banks’ portfolios are also in forbearance.
The largest declines in forbearances were seen among GSE loans, which declined by 200,000 – an 11% reduction in a single week. Portfolio and PLS loans in forbearance also fell by 11%, equating to 136,000 fewer active forbearance plans. FHA/VA saw the slightest improvement, declining just 6% for a 93,000 reduction.
The overall decline in active forbearance plans is likely driven at least in part by the fact that more than half of all active forbearance plans at the start of June were set to expire at the end of the month. While the majority have been extended, this week’s data suggests a significant share were not.
Again, recent spikes in COVID-19 around much of the country and the scheduled expiration of expanded unemployment benefits both represent significant uncertainty for the weeks ahead. Black Knight will continue to monitor the situation and provide updates via this blog.