Forbearance Plan Exits Strong Through Second Week of January
As the COVID-19 pandemic continues to create uncertainty in the global economy, the overwhelming majority (89%) of single-family homeowners who sought financial assistance through COVID-related mortgage payment forbearance plans have exited those plans.
According to our McDash Flash daily forbearance tracking dataset, the number of active forbearance plans decreased 43,000 (-8%) this week. Portfolio-held and privately securitized (PLS) plans led another across-the-board decrease, with a 22,000 (-8%) weekly decline, followed by a 17,000 (-6%) decrease in FHA/VA plans and a 4,000 (-1.6%) drop in GSE plans.
As of January 11, 780,000 (1.5%) single-family mortgage holders remain in COVID-19 related forbearance plans, including 1.0% of GSE mortgages, 2.1% of FHA/VA and 2.0% of portfolio/PLS. New plan starts edged upward this week hitting their highest level since the first week of December. The 4-week moving average, however, remains down 9% month-over-month.
Overall, plan volumes are down 100,000 (-12%) from the same time last month, as borrowers continue to reach the end of their allotted forbearance terms.
Exit volumes may pull back in coming weeks with only 155,000 plans still slated for review by the end of January with just over one-third expected to be reaching their final plan 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.